Azernews.Az

The largest car manufacturing factory in Iran, with a projected annual output of 5 million cars, is being established in Iran, Trend news agency reported referring to ISNA agency.

The factory's output will be higher than the total outputs of the two current main carmakers, namely Iran Khodro and Saipa.

The new factory will produce the first national Iranian car, which will hit the market by March 2015 at an estimated price of $10,000-$12,000.

Iran's vehicle manufacturers are faced with both rising production costs and lacking some details after the giant auto companies left Iran because of sanctions aimed to curb the country's disputed nuclear program.

These include Italian Fiat, German General Motors and its French partner PSA Peugeot Citroen, South Korean Hyundai and the Japanese Toyota Motor Corporation, etc. Iran's major car producer Iran Khodro which had been a partner of France's Peugeot since 1989, had to close some production units.

Meanwhile, deputy manager of Iranian Khodro Company, Hossein Najjarpour, said last week that IKCO has become self-sufficient in manufacturing cars.

Following the US-generated sanctions, Iran Khodro had some problems providing Peugeot 206 parts.

IKCO has restarted manufacturing Peugeot 206 from the beginning of current Iranian calendar month (December 21, 2012).

On Nov. 27, 2012, ISNA news agency reported that several car companies in Iran halted their production, while according to ISNA report the auto production dropped by 66 percent in September compared to last years' figures.