Azernews.Az

By Sara Rajabova

German car manufacturing company is reportedly looking for the partners in the Islamic Republic.

Daimler AG's commercial vehicles division said it is in talks with potential partners in Iran to resume production in the country as sanctions look set to be lifted.

Following a nuclear deal between P5+1 and Iran, the race has tightened for access to Iran’s auto market. European automakers, which were forced to leave the Iranian market after international sanctions on the Islamic Republic for its nuclear program, are now attempting to restore their previous shares in Iran’s vast car market.

Roland Schneider, president and CEO of Daimler Commercial Vehicles in the Middle East and North Africa, said the German manufacturer intends to open a representative office in Iran “as soon as possible”, Press TV reported.

He noted that Iran offers great opportunities for Daimler Commercial Vehicles, and the company is currently preparing to re-enter this market.

Recently, Mohammad Hazrati, export manager of the Iran Khodro Diesel has said the new round of cooperation between Iran Khodro Diesel and Daimler AG aims to focus on manufacturing new versions of motors in Iran.

He said Daimler is Iran’s traditional partner, and Iran Khodro Diesel has started negotiations with the German company and widespread cooperation is expected after sanctions are removed.

Earlier, Hashem Yekeh Zareh, the CEO of Iran Khodro Industrial Group (IKCO), claimed that the German company would purchase 30 percent of Iranian Diesel Engine Manufacturing's (IDEM) shares to produce cars in Tabriz, adding that Mercedes-Benz would sign a 10-year agreement to produce trucks and autobuses in Iran.

IDEM and Daimler AG have been partners since 1969. However, this relationship was interrupted when the German company left Iran during the period of sanctions.

European automakers are in a race for fresh inroads into the country of 80 million people which is being promoted as the region’s biggest automotive market.

The automobile industry accounts for nearly 10 percent of Iran’s gross domestic product. The latest data shows that Iran ranks 18th on the list of the world’s top auto manufacturers. However, the country’s automotive industry needs modernization after years of sanctions.

Sanctions on Iran hit the automotive industry hard, cutting production by 1 million units from its peak of 1.6 million in 2011 and leading to 100,000 job redundancies.

--

Sara Rajabova is AzerNews’ staff journalist, follow her on Twitter: @SaraRajabova

Follow us on Twitter @AzerNewsAz