Mohammad Hassan Shojaeifar, Head of the Faculty of Automobile in Iran University of Science and Technology: The trade system will certainly not have the past mistakes but the problem is that some companies still cannot register their cars. Also, the government should clarify the status of non-representative companies once and …

Head of the Faculty of Automobile in Iran University of Science and Technology

 

 

An increase of 60 percent in vehicle imports this year

 

Iran’s car industry has been turbulent over the past few years, both in domestic manufacturing and in the import sector. While according to customs data, Imports of cars in the first month of this year have decreased, the scrutiny of this issue at this critical moment is hugely important that plan of organizing the automobile market is under investigation in the Industries and Mines Commission of parliament

 

According to Akhbar Khodro, the issue of increasing the cost of car imports in the country has also caused many problems for the activists of this field. To study these topics, we went to Mohammad Hassan Shojaeifar, a professor at the University of Science and Technology. He spoke in a conversation with the newspaper Donyaye Khodro. Many import activists expect officials to have balance in the market, not increasing the prices by shaking the market.

 

How much of the vehicle’s original parts are produced by importers? Does the government’s macroeconomic policy on imports and major parts of the car, as well as tariff increases, can be effective in preventing foreign currency exports?

Half of the imported car dismantled parts come from China, and their value is about twice the value of imported vehicles a year ago. Due to all the incidents that took place in the automobile import market in the month of March, we encountered a new directive in the field of car imports, in which the car import tariff increased by 30%, and despite all judicial orders, this tariff increase was applied.

 

How much is effectiveness of tariff increase at the expense of imports, and how can the 4200 USD currency allocation reduce import costs?

This year, new car import charges have been imposed. With a 10% increase as a new tariff in this year’s budget, total tariffs show a 40% increase, while customs clearance fees, customs duties and customs have also increased by $ 4200 / ton. Hence, if we add 40% increase in tariffs to the real rate, now we have about 60% increase in the cost of importing cars. This will mean the consumer should pay the price increase.

 

How much did the car imports last year increase or decrease? How do you check this status?

Last year, 67,800 has been imported which compared to last year, 12% fell in terms of dollar and rial values. Last year, the share of car imports from total imports was about four-and-a-half percent which a part of this amount, is related to automakers. In addition, 91% of the market is available to large automotive companies.

 

With the changes in the Comprehensive Trade System, will we not see the past problems for non-representative companies? How do you see the presence of economic agents in the future of the car market?

The trade system will certainly not have the past mistakes but the problem is that some companies still cannot register their cars. Also, the government should clarify the status of non-representative companies once and for all

 

 

 

Due to the closure of car registering web-site in the last six months of the past year, the market faced price increases. What is your assessment of the market at the moment?

Regarding the closure of the website, we faced a natural increase in prices. Meanwhile, the consumer paid the price increase. Although we saw the price and market of inflammation last year, it slowed down slightly with the re-launching the website, but the prices have shown a huge increase. On the one hand, the domestic automobile manufacturers cannot be supported by increasing the car tariffs.

 

 

What happens if tariff reductions?

If tariffs are reduced, we will see a competitive atmosphere in automotive manufacturing and this industry will be on the path to growth. It is very important for us to take advantage of the experience of other countries and the way the car industry has gone through and succeeded.

 

 

The issue of exports is one of the topics that is widely discussed in the automotive industry around the world, and experts believe that the production of export-oriented products represents the dynamic industry. How do you assess the export situation in the automotive industry?

In the past, our automotive industry has experienced $ 400 billion in exports in a year, but this has been falling and dropping over the past year, which suggests a lot of content. At present, the cost of car production in the country is very high and this can be the result of the state structure of the automobile industry of the country. If the automotive industry was actually privatized, then we would see long-term planning and a comprehensive program was developed for export. We hope this is a well-designed plan for the automotive industry so that the industry will be on the right path.

 

What is the role of government in the development of the automotive industry?

The government must act only as a policymaker and avoid interfering in the automotive industry. The issue that has been implemented by their governments in other countries and has made many successes in this regard, therefore, it is necessary for the government to keep the distance from business in the automotive industry, and only to involve in policy-making.