Tehran, Iran, Aug.16
Trend:
A member of Tehran Chamber of Commerce, member of Board of Directors of Iranian Automotive Parts Manufacturers Association Mohammad Reza Najafi-Manesh talked about automakers' debts to auto part manufacturers in an interview with Trend .
"In general, around 550,000 people work in the auto part industry, while about 280,000 are getting unemployed or being downsized," he said.
"Some of the laid off forces have temporary resumed their work in factories by injection of $925 million bank advances in the end of last Iranian year [started March 21, 2018]; unfortunately, in current Iranian year [started March 21,2019] we have witnessed new downsizing," he noted.
"Almost 400 units out 1,200 active auto part makers are closed or nearly closed. Despite the increase of raw material costs, the prices have not been changed in time; therefore, in the current year the auto part makers would face losses," he said.
"The liquidity deficit of $3 billion in auto parts manufacturing sector is due to rise of the cost of the production. The auto making industry's general debt to domestic automakers exceeds $5 billion, while the prices for auto parts have not been re-calculated since 2018," he noted.
"The total value the assets of the country's auto part makers is around $83 billion," he added.
In his words, Iran's auto industry directly employs around 700,000 workforce, with 550,000 people working in the auto parts manufacturing sector and 150,000 people wok for automaking companies.
"Around 160,000 incomplete vehicles worth more than $2 billion are in the parking lots of automakers and remained blocked," Najafi-Manesh added.
The member of Tehran Chamber of Commerce believes that it will not be possible to boost the production under the current conditions, so automakers' commitments to deliver vehicles to the market won't be fulfilled.
"Managers of many auto part companies are facing crisis or are prosecuted for heavy debts, so their activities are suspended. The auto makers and auto part manufacturers have $7 billion and $3 million accumulated losses respectively. The necessary investment to create new jobs for 280,000 unemployed workers is $35 billion, and in case the trend continues, the required amount of investment will increase," he noted.