EghtesadOnline: Iran’s largest automaker Iran Khodro Group (IKCO) plans to open new plants in neighboring Azerbaijan following years of absence from neighboring CIS markets.
The issue was on the agenda of the Azerbaijan-Iran Business Forum in Urmia, where a delegation headed by Azeri Economic Minister Shahin Mustafayev arrived in the northwestern Iranian city to discuss expansion of cooperation, according to Azer News.
Mustafayev told the meeting that Iran’s biggest automaker Iran Khodro plans to open four new production lines in Azerbaijan with production of locally developed models and the Samand, Soren and Runna being the most likely candidates.
In 2016, Azerbaijan’s AzEuroCar LLC and Iran Khodro signed an agreement to create a joint car plant in the Neftchala Industrial Area. The plant with a capacity of about 10,000 cars per year will produce four Iranian models including the Dena, according to Financial Tribune.
The cost of the future auto project is estimated at $15 million. The plant is expected to produce the first cars in May. Some 20% of the vehicles will be exported to other CIS countries including Georgia and southern Russia.
The cars produced at the Azeri plant will meet Euro 5 standard as per Azeri law.
Mustafayev noted that Azerbaijan and Iran intend to increase bilateral trade to $500 million in the coming years.
Trade turnover between the two neighbors reached $15.77 million in January, while last year during the same month it was $9.56 million. In 2016, Azerbaijan’s trade turnover with Iran amounted to $210.76 million, which was 70% more than in 2015.
He noted that 538 companies with Iranian shareholders operate in Azerbaijan and have invested $150 million in the neighboring republic.