In January 2016, following a report by the UN International Atomic Energy Agency (IAEA) certifying that Tehran has met all its obligations under the nuclear deal with world powers, most of the UN, US and EU sanctions on Iran were lifted.
In the same month, PSA Peugeot Citroën and Iran’s largest carmaker, Iran-Khodro Company (IKCO) signed a joint venture agreement to produce latest-generation vehicles in Iran.
“Peugeot’s compensation to Iran has been included in the new contract, but the content of the contract remains confidential,” Iran’s Minister of Industry and Trade, Mohammad Reza Nematzadeh was quoted as saying by the Tasnim news agency yesterday.
Peugeot declined to comment on details of the deal but its spokesman told Reuters that “the deal signed with Iran is a good and balanced one.”
Iranian hardline lawmakers criticised President Hassan Rouhani for paving the way for a contract with Peugeot when no compensation was paid.
Based on the agreement between Peugeot and IKCO up to €400mn over the next five years will be invested in manufacturing cars in Iran, according to IKCO’s news website, and the investment will contribute to facilitate the development of a competitive manufacturing base for producing, launching and marketing Peugeot 208, 2008 and 301 models, fitted with latest-generation engines.
As many as 4mn Peugeot cars are currently on the roads in Iran.
For Peugeot, the Iranian factory tie up is critical. When it suspended sales in Iran in 2012 it lost nearly 10% of global deliveries and interrupted a relationship dating back more than 50 years.
