Google – AFP, Romain Fonsegrives (AFP), 25 November 2013
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Iran's
state-owned car manufacturer Iran Khodro unveils a Peugeot 207i, a
locally-built
version of the French automobile giant's 207 model, in Tehran on
February 20, 2010
(AFP/File, Atta Kenare)
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Paris —
French carmakers Peugeot and Renault look to be among the clearest
beneficiaries of the interim deal that lifts some sanctions on Iran, with both
hoping to leap back into the Middle East's biggest auto market.
One of the
explicit concessions world powers made in the accord signed Sunday in exchange
for Iran curbing its nuclear programme was the promise to "suspend US
sanctions on Iran's auto industry".
For Peugeot
and Renault, which had to pull out of Iran in 2011 and 2012 respectively, those
words are worth big money -- especially as both are struggling in a languishing
European climate.
PSA Peugeot
Citroen was the top car manufacturer in Iran before the sanctions, selling
458,000 vehicles in 2011 in what used to be its second-biggest market worldwide
after France.
Its cars, most of them assembled by an Iranian partner firm and
rebranded, are ubiquitous on Tehran roads.
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A picture
taken on December 18, 2012 in
Pont-l'Abbe, western France, shows French
carmaker Renault's former chief operating
officer Carlos Tavares (AFP/File,
Fred
Tanneau)
|
Renault
sold 103,000 vehicles there last year before leaving.
Iran itself
counts car manufacturing as its second-biggest industry after oil, accounting
for 10 percent of its gross domestic product.
Before the
sanctions, there were 1.4 million new cars entering its market. After the
sanctions, that number fell by more than a third -- but it still remains the
biggest market in the Middle East, more than twice as big as Saudi Arabia.
PSA Peugeot
Citroen "is closely following the development of the situation concerning
Iran, but we are not about to resume our sales activities tomorrow," a
company spokesman told AFP in Paris.
The effects
of the Iran deal "are still unclear," he said. "The day when the
sanctions no longer exist, we could look at how to return to our
activities."
The caution
shown by PSA Peugeot Citroen stemmed in part by the fact that it has US group
General Motors as a partner. That relationship was seen as instrumental in it
having to quit Iran despite the heavy operating loss of around a hundred
million euros ($135 million) it represented between 2011 and 2012.
Also to
factor in is the temporary and "reversible" nature of the deal with
Iran, which is to apply for a six month period during which the Islamic
republic and world powers will try to reach a permanent and comprehensive pact.
'Good news'
Renault,
though, which counted Iran as its 8th biggest market by volume before the
sanctions, was more enthusiastic.
"Renault
is satisfied by the signing of this accord, which should allow the sanctions to
be lifted. If the sanctions are lifted, our activity which is currently slowed
could return to its normal course," a company spokeswoman said.
"It's
good news for us because the Iranian market is important for us," she
added.
On Monday,
shares in PSA Peugeot Citroen soared 4.45 percent to 10.68 euros in afternoon
trade, while Renault shares rose by 1.15 percent.
That
reflected what Tangui Le Liboux, an analyst at the Aurel BGC brokerage, said
was the "good news" the Iran deal brought the companies.
"The
two French carmakers were the best placed among all their European rivals
before the imposition of the embargo in recent years," he said.
The two
companies will have the opportunity this week to renew their Iranian
connections this week.
The French
industry ministry has organised a conference on Saturday in Tehran bringing
together all of Iran's car makers. Renault has confirmed to AFP it will attend.
PSA Peugeot Citroen declined to comment.
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