TEHRAN – Iranian Industry, Mining and Trade Minister Reza Rahmani said his ministry is planning on handing over the country’s major auto makers to the private sector, IRIB reported.

“Automobile manufacturing companies are not going to be awarded to any real entity, but we are considering handing them over to the private sector,” the minister told reporters on the sidelines of a cabinet meeting on Wednesday.

Pointing out that the country’s auto makers are going to suspend production of two passenger car brands in the near future, the minister noted “Of course, an appropriate passenger car will replace them.”

He further noted that automotive companies are pursuing the mentioned program, adding "We're also pursuing and supporting this program, and in the first phase, the production of Pride will be halted.”

Earlier in August, Rahmani had said that the production of Pride car will be discontinued as from 2020. Pride has been Iran’s best-selling brand of car.

He added that in order not to repeat the past mistakes in privatizations, the government is working to downsize both companies and then to hand over them to the private sector.

He reiterated that the government is not interested in running businesses and it backs privatization.

Earlier this week, Rahmani criticized French giant auto-makers Peugeot and Renault for breaching their contracts after the U.S. sanctions, adding that the country is now seeking to find new foreign partners. 

Since the U.S. reimposed sanctions on Iran to pressure the country’s economy, most of the European automakers active in the country has left under U.S. pressures, however Iran has been taking necessary measures to mitigate the impact of the sanctions and counter the U.S. actions.

Improving and boosting domestic production has been one of the major strategies that Iran has been following in the past two years in order to increase its economy’s independence.

In mid-May, Rahmani issued a directive on “strengthening domestic manufacturing of imported auto parts”.

He said the policy of domestic manufacturing of auto parts should be seriously followed up, and in this due the capable manufacturers should be seriously supported.

EF/MA