IRAN: West's sanctions hit Logan JV output

11 March 2008 | Source: just-auto.com editorial team

Iranian production forecasts for Renault's Logan have been cut with the local joint venture blaming US-led banking restrictions against Tehran over its nuclear drive.

"Iran_Khodro's commitment by the end of the Iranian year (19 March) was 51,000 units but it will have 13,000 made by then," the company's director in charge of production of the Logan, Mohammad Hossein Faghih, told Agence France Press (AFP).

"Some of our manufacturers had problems with imports of primary materials that were under sanctions. We try to use other ways to overcome this problem which has delayed the delivery of our commitments," Faghih said.

AFP noted that, in punishment for its defiance of major powers' demand that it halts its sensitive nuclear activities, the United States has pressured European allies to cut banking operations with Tehran to a minimum.

Iran has been also slapped by three sets of UN Security Council sanctions which restricts some dual-purpose equipment which could also be used in the nuclear industry.

The Logan, sold locally as the Tondar ['Thunder'] is made by Iran Khodro and Saipa as part of a joint venture with Renault.

AFP said many Iranians who made down-payments for the new car last March are still waiting for their vehicle to be delivered. Last June, the joint venture forecast production would reach 10,000 a month by now.

"Iran Khodro is drafting a new plan to partly take responsibility for procurement whose supervision, supply and management is 100% in the hands of Renault Pars," Faghih said.

According to the news agency, Iran Khodro managing director Manouchehr Manteghi played down the significance of sanctions and stressed that the company would find a way out if the situation becomes tougher.

"We will continue what we have had with the French partner and if any problem occurs we will come up with a solution," Manteghi told AFP.