February 27, 2019
A verdict has been issued for recalling 30,000 faulty vehicles produced by car manufacturers in Iran, says the director of the Islamic Republic’s Governmental Discretionary Punishments Organization (GDPO), Mohammad Ali Esfanani.
Although Esfanani has not named the manufacturers, given the number of vehicles to be recalled, he apparently was either referring to giant local automakers SAIPA or Iran Khodro.
SAIPA (Société Anonyme Iranienne de Production Automobiles) is an automaker based in the capital city of Tehran. The company was established during the reign of Shah Mohammad Reza Pahlavi in 1965, with 75% Iranian ownership, to assemble Citroëns under license for the Iranian market. Its products in recent years have been mostly old model South Korean cars.
Iran Khodro (IK), also headquartered in Tehran and founded in 1962, long before the Islamic Revolution, was originally named Iran National. It produced 688,000 passenger cars in 2009. IK manufactures vehicles, including Samand, Peugeot and Renault cars, and trucks, and buses.
Over the years, locally manufactured cars have developed a reputation of bad quality.
According to the director of GDPO, it’s the first time that a verdict for recalling vehicles has been issued in Iran.
“The vehicles produced and sold by the manufacturer are suffering from serious faults and being substandard,” Esfanani asserted.
The verdict is not final, and the car manufacturer may appeal against it, Esfanani noted, adding, “If finally approved, the verdict would be implemented. However, should the manufacturer compromise with the plaintiffs, the recall of the faulty vehicles would stop.”
The quality of SAIPA and IK vehicles has been widely criticized in recent years. Nevertheless, since the two have no major competitor, and thanks to tariffs on the imported cars, they have ignored the criticism, so far.
The tariffs, along with the sanctions imposed on the Islamic Republic, experts say, are another significant hurdle for the foreign automakers to invest in Iran’s car manufacturing industry.