EghtesadOnline: Speaking at the ceremony Fariborz Shahbaz, SAIPA Citroen’s director said, “The production lines are being installed and will be launched before September 2018. Initially 20% of parts used in the cars will be locally manufactured.”
Production of the C3 will increase to 200,000 units per year, said Yann Martin, deputy general manager of SAIPA-Citroen and noted that 30% of the cars produced under the SAIPA-Citroen contract will be exported.
Regarding the possible risk of US sanctions return, Martin said, “We are not a political entity. We just want to do business in Iran.”
Ali Momeni, sales manager for the joint venture, said, “Iran-made parts will eventually have a 70% share in cars produced under the Citroen brand.” He did not elaborate nor say how much the C3 would cost, according to Financial Tribune.
Localization has emerged as a pillar of the government’s stringent rules guiding new auto contracts local firms sign with foreign carmakers wanting to make, assemble and import cars in the saturated Iranian market.
The C3 is a small hatchback equipped with a 1.6 liter turbo four cylinder engine with 163hp output. The vehicle meets Euro 5 emission standards and was initially unveiled in 2002 in France. However, the latest version of the car introduced in 2016 will be sold in Iran. In addition to the Citroen badge, the vehicle offered in Iran will carry the SAIPA-Citroen badge in Persian.
SAIPA and Citroen signed a 50-50 joint venture in late 2016 according to which the Paris-based carmaker is obliged to invest more than €300 million ($352 million) in Iran during the next five years. In addition to C3, another model Citroen C4 will also be assembled in Iran.
Earlier in the week local media reports said SAIPA had imported the first shipment of the C3 parts.
Excluding the Tehran bash and flashy unveiling ceremony, importing parts for C3 has been SAIPA’s first move towards implementing its contract with the French auto giant. It merits mention that the company has put up an unimpressive sign in front of SAIPA’s Kashan production plant that reads “SAIPA Citroen Company”.
The Iranian semi-state-owned firm has often claimed that the first units of C3 will be available in the market by the end of the current fiscal next March. Auto industry experts and market observers, however, say SAIPA will not be able to meet the self-imposed deadline.