Peugeot-Citroën Announces Serious Negotiations to Return to Iran

A senior official from Peugeot-Citroën announced on Tuesday, December 1, in Tehran that the French company is engaged in serious negotiations to resume its activities in Iran. According to AFP from Tehran, the French automaker's operations in Iran were halted in March 2012 following the imposition of Western economic sanctions against Tehran due to its nuclear program. Jean-Christophe Quémard, the operational director of Peugeot-Citroën in the Middle East, stated at an automotive industry exhibition and conference in Tehran that Peugeot is eager to return to Iran. He said, 'Negotiations are seriously underway. We have a long-standing relationship with Iran and wish to start joint cooperation in all lines of vehicle production as soon as possible.' The United States added Iran's automotive industry to its sanctions list in 2013, but these sanctions were lifted following a temporary agreement between Iran and global powers regarding Iran's nuclear program. Previously, Iran was Peugeot's second-largest market in terms of vehicle production, and currently, one-quarter of vehicles in the Iranian market bear the Peugeot brand. AFP further reports that negotiations between Peugeot and Iran Khodro began in October at the Paris Motor Show. Vehicle production in Iran was 1.6 million units in 2011, but the impact of two years of economic and financial sanctions has halved production volume. Organizers of the automotive industry conference on Tuesday called for attracting foreign investment in the automotive market, but they believe that the conditions for joint activities and cooperation have not changed. With a population of over 77 million, Iran is considered a virgin market for foreign investors. According to a new contract, the Ministry of Industries plans for 40% of production to be conducted in Iran at the beginning of this cooperation, with the share of participation expected to rise to 85% within a multi-phase program over five years. Mohammad Reza Nematzadeh, Iran's Minister of Industries, Mines, and Trade, stated on Tuesday that Iran is determined to increase vehicle production in the country to three million units per year by 2020.