EghtesadOnline: Domestic production accounts for about 40% of tire and motor oil demand in Iran.
To help meet this demand for such products, the country relies on imports from China, Thailand, Taiwan, India and South Korea, the Persian daily Forsat-e Emrooz reported.
There are eight tire manufacturers in Iran, most of which were established before the Islamic Revolution of 1979. Over the past four decades, only two tire manufacturing factories, namely Yazd Tire and Barez Manufacturing Group, were launched in the country.
Dena Tire and Rubber Manufacturing Company, Yazd Tire, Alborz Tire and Iran Tire Manufacturing Company account for the lion's share of the local market, Financial Tribune reported.
The main raw materials of tires are natural and synthetic rubber. Synthetic rubber is supplied by the local petrochemical industry whereas natural rubber is imported. In fact, 80% of what's available in the domestic market are made of imported raw materials, including thread, wire and natural rubber. On average, about 350,000 tons of rubber are consumed in Iran on a yearly basis.
Factories’ overcapacity is the main problem with Iran's inner tube (the rubber tube within certain tires) production. Annual demand for rubber tubes stands around 10 million but four of the above-mentioned factories manufacture 20 million tires a year.
Add to this, the annual production of 2 million rubber tubes by Shahab Tire, 5 million by Yazd Tire and 10 million by Iran Yasa Tire and Rubber Company.
There are 50 brands of motor oil available in Iranian market. Motor oil production in Iran dates back to the 1940s. Industrial machines currently used in the production of motor oil were designed 50 years ago.
New machinery purchases have not been made for this industry mainly due to years of international sanctions against Iran over its nuclear energy program. Therefore, the output of such outdated equipment cannot compete with imported products.