A leading Russian automaker has called for cooperation with Iranian parts manufacturers to supply it with critical vehicle components, Iran’s official news agency IRNA has reported.
The Ukraine war has upended car production in Russia which is the eighth-largest automotive market in the world. Several global manufacturers have halted deliveries to Russia, while others have been forced to pause production due to a lack of parts.
The Russian carmaker, which IRNA did not identify, has sounded out Iranian parts and equipment manufacturers on the possibility of supplying its production lines with required products, a member of the Iranian Auto Parts Manufacturers Association (IAMPA)’s presiding board said.
“Given the prominent Russian automaker’s demand for cooperation with Iranian parts manufacturers, companies that have the ability to supply the Russian side in terms of quality and quantity of production, can try their luck for a presence in the market of this northern neighbor,” Hossein Bahrainian said.
Master cylinder brake boosters, hydraulic anti-lock braking systems, ABS sensors, seat belts, airbags, alternators, air conditioners, oxygen sensors, thermostats and window lift systems are among the parts demanded by the Russian automaker, he said.
Bahrainian said an Iranian automaker has already been planning to take advantage of the maritime border to carve out a bigger share of the Russian and Eurasian market.
Some Iran-made automotive components such as engine cooling systems, suspension and casting parts have been exported to the Russian market in recent years.
The conflict in Ukraine has caused logistical and supply chain problems as well as parts shortages of critical vehicle components.
Many automakers source wire harnesses, which are used in vehicles for electrical power and communication between parts, from Ukraine. The problems add to an already strained supply chain due to the coronavirus pandemic and an ongoing shortage of semiconductor chips.
They have impacted vehicle production not only in Ukraine and Russia but have also destabilized supply of components in other parts of Europe and beyond – with other risks as well in the upstream supply chain.
Russia is currently subject to unprecedented Western sanctions amounting to an economic war that, experts say, will have profound implications for the global economy and the automotive supply chain.
Several global manufacturers have severed ties with partners in Russia, including Groupe Renault, BMW, Jaguar Land Rover, Stellantis and the Volkswagen Group.
Renault is the most exposed in Russia which is the French carmaker’s second largest market, contributing around $5.5 billion or 12% to its balance sheets. The group has a 51% stake in Avtovaz, assembling Ladas, 90% of which are sold within Russia.
In March, Avtovaz announced partially halting production at its plants due to shortages of electronic parts.
For Avtovaz and other Russian industrial groups, Iran offers a way to beat sanctions.
Iran’s auto sector has started standing on its own feet after years of reliance on imported car kits which foreign companies stopped supplying when the US reimposed sanctions on the Islamic Republic in 2018.
By PRESS TV