EghtesadOnline: Iran’s Niksun Sanat Company has signed a contract with Japanese Suzuki group for the joint manufacture of home appliances, the managing director of the Iranian company said on Wednesday.
Saeed Rezvani added that in the first phase of the contract, the two companies would cooperate in manufacturing refrigerators and freezers, and then they would expand their collaboration in producing other household items.
“The production line of Niksun Sanat is already established and will be functional for making Suzuki’s products. Therefore, it won’t take long to launch the licensed production of Suzuki-branded refrigerators and freezers. Products will be first offered in the domestic market and later they will be exported to Middle Eastern countries,” he was quoted as saying by IRNA.
“Suzuki has only one representative outside Japan, which can manufacture its products; Iran has managed to secure the confidence of the company to become the manufacturer’s second representative in the world,” he said.
Nilsun Sanat Company was established in 1993 in Kaveh Industrial Town in Saveh, Markazi Province.
Strong Rise in Domestic Home Appliance Production
Latest statistics released by the Ministry of Industries, Mining and Trade show the domestic production of three types of home appliances has increased.
About 481,600 television sets were produced in the country during the first five months of the current Iranian year (March 20-Aug. 21) to register a 78.7% growth compared with the similar period of last year, IRNA reported.
A total of 368,400 washing machines and 673,800 refrigerators and freezers were manufactured during the same period, registering a respective rise of 58% and 18.8% YOY.
Between 30% and 35% of home appliances and spare parts are imported and the rest are made in local factories.
Secretary-General of Iran’s Home Appliances Association Habibollah Ansari told Financial Tribune last year that the production of Iranian household appliances meets 70% of domestic demand.
“The rise in production has come about in the midst of heavily imposed economic sanctions worsened by the spread of Covid-19 pandemic. To top those, the import and supply of the industry’s required raw materials have been hampered by delays on the part of the Central Bank of Iran in allocating forex to the manufacturers. Yet, over a month ago, promises were made and businesspeople active in home appliances industry are now experiencing fewer problems in procuring their forex need,” he said.
Iran’s output of home appliances increased by nearly 8% in the last Iranian year (March 2019-20), a deputy industries minister said in June.
“Plans are to boost production by 34% in the current year for production to hit 11.6 million home appliances," Mohammad Reza Kalami was also quoted as saying by Tasnim News Agency, adding that by March 2022, production will meet total domestic demand.
“Last year, the production of small appliances, refrigerator and television posted a year-on-year growth of 12%, 12% and 3%, respectively. The industry experienced a 10% growth last year despite all restrictions imposed by sanctions,” Mehdi Sadeqi-Niyaraki, deputy industries minister, was quoted as saying by IRIB.
Kayvan Gordan, another senior official with the ministry, said nearly nine million devices were produced in the country last year, which are barely 50% of the industry’s potential.
“There is no shortage of supply of home appliances, though a ban has been placed on their imports since past two years. Some smuggled goods in the market have seen price increases recently,” he added.
Domestic demand for home appliances was around 13.6 million in the year ending March 2018, but has now reduced to 12 million, given the rise in the value of foreign currencies and prices.