Exchange Rate Fluctuate is Affecting Part Industry
Currency exchange rate turbulence is affecting different industries and parts makers are not safe from it either. Companies which could handle more than half of country’s auto making are thinking about leaving this industry.
Khodrocar – second half of the last Iranian year was full of different
mottos for supporting parts makers, but at the first month of the New
Year, the country’s economy and the auto industry are struggling with
different problems and it will harm part makers more than others.
The government and the parliament were talking about supporting and helping part makers and it was promised to be a share for part makers in foreign contracts. But now currency exchange rate and part importation have been raised and some manufacturers are thinking about leaving this industry.
"The only thing that the government should do is to stop talking. These days sudden changes are making most of the problems rather than exchange rate turbulence. These turbulences have made some unstable condition for production.” Said Bahram Shahriary, an expert on the auto industry.
"The instability in production means that the producer doesn’t know if he could buy first materials for production again in the following days or not. On the other hand, part industry depends on the local market for supplying first materials as it depends on foreign markets, so any changes in the market and prices would have effects on the port industry.” He added.
As Shahriari said since last year some of local parts makers have faced with different problems after their subsidy axed. "This year has been named as "The Year of Support for Iranian Products” but it seems to be the year that the rest of Iranian manufacturers are going to close their companies.” He continued.
"Right now, importing parts have two problems. First auto makers are standing against increasing tariff rate and the second is auto part trafficking in the after sales service market. Both of these reasons have impacts on the parts manufacturers’ activity.” He continued. "Without a proper plan, we are not going to be an automaker country. If the private sector wants to enter the industry or the government is thinking to support, they all should have prepared plans and execute it step by step. Today, prices turbulence is not the main problem, but it’s the effects of previous governments that is showed up.”
The first days of 1397 were predicted to be quiet in the market, but exchange rates fluctuate began in the middle of the holidays and now parts industry is struggling with it. On the other hand, parts makers are awaiting for the government support to find out if they have to leave the industry or not.
Khodrocar Reporter: Negar Mir Karimi
Khodrocar Translator: Amin Zamani
The government and the parliament were talking about supporting and helping part makers and it was promised to be a share for part makers in foreign contracts. But now currency exchange rate and part importation have been raised and some manufacturers are thinking about leaving this industry.
"The only thing that the government should do is to stop talking. These days sudden changes are making most of the problems rather than exchange rate turbulence. These turbulences have made some unstable condition for production.” Said Bahram Shahriary, an expert on the auto industry.
"The instability in production means that the producer doesn’t know if he could buy first materials for production again in the following days or not. On the other hand, part industry depends on the local market for supplying first materials as it depends on foreign markets, so any changes in the market and prices would have effects on the port industry.” He added.
As Shahriari said since last year some of local parts makers have faced with different problems after their subsidy axed. "This year has been named as "The Year of Support for Iranian Products” but it seems to be the year that the rest of Iranian manufacturers are going to close their companies.” He continued.
"Right now, importing parts have two problems. First auto makers are standing against increasing tariff rate and the second is auto part trafficking in the after sales service market. Both of these reasons have impacts on the parts manufacturers’ activity.” He continued. "Without a proper plan, we are not going to be an automaker country. If the private sector wants to enter the industry or the government is thinking to support, they all should have prepared plans and execute it step by step. Today, prices turbulence is not the main problem, but it’s the effects of previous governments that is showed up.”
The first days of 1397 were predicted to be quiet in the market, but exchange rates fluctuate began in the middle of the holidays and now parts industry is struggling with it. On the other hand, parts makers are awaiting for the government support to find out if they have to leave the industry or not.
Khodrocar Reporter: Negar Mir Karimi
Khodrocar Translator: Amin Zamani
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