TEHRAN - French carmaker Renault sales in the Middle East and Africa region fell 27.7 percent largely as a result of Renault’s 2018 withdrawal from Iran under threat of U.S. sanctions, the company said in a statement on Tuesday.

According to Reuters, the company posted a 6.7 percent decline in first-half vehicle sales amid a global auto slowdown, but said a forthcoming product offensive would begin to help soften the blow in key markets.

Sales fell to 1.94 million light vehicles in January-June from 2.08 million a year earlier. The slump was outpaced by a 7.1 percent global market contraction, it added.

Deliveries also fell 5.2 percent in the Eurasia region including Russia, and 3.9 percent in the Americas, where Renault sees the Brazilian market rebounding eight percent this year. Renault is scheduled to publish full first-half results on July 26.

In August 2017, Renault inked a €660-million deal in Tehran to form a joint venture company for establishing a plant with an initial production capacity of 150,000 vehicles a year.

Through manufacturing of over 160,000 vehicles in Iran, Renault hit a record high in 2017, according to a report by the Communications Department of Renault Pars (a joint venture established in 2004 between France’s Renault and Iranian car makers Iran Khodro and Saipa).

The report said that production of Renault in Iran witnessed a 48-percent growth in 2017 and gaining 11 percent of the Iranian market, the company experienced its most successful year of performance in the Middle East country.  

However, after U.S. withdrew from Iran nuclear deal, In July 2018 the group announced that it would comply with the sanctions and decided to leave Iran.

“We are looking to new business opportunities, particularly in Africa, with strong growth to offset the missed opportunities in Iran,” Renault Chief Operating Officer Thierry Bollore said in July 2018.

Renault and its French rival PSA Group were among the first European companies which rushed to Iran to tap into a pent-up demand for new automobiles after sanctions were lifted on the country in 2016.

EF/MA