Re-injecting life into the veins of car manufacturers/ when the need for liquidity overtakes production

According to the available statistics, based on the government's approval, it was decided to pay 2,500 billion tomans to each of Iran Khodro and Saipa companies, and according to this, from March 2018 to April 6 this year, 2,400 billion tomans to Iran Khodro and 1,950 billion tomans Tomans were paid to Saipa, but since the car manufacturers had other costs besides the debt to the supply chain, not a single Riyal of this amount was paid to the parts makers, which made the initial steps to increase the need for more liquidity as well as the increase in the demands of the parts makers According to the activists of the parts industry and based on the available statistics, the debt of the parts makers from the car manufacturers has reached about 70 thousand billion tomans, while in the last days of last year, the amount of this debt was announced as 55 thousand billion tomans.

Now, in this situation, Alimardan Azimi, the CEO of Iran Khodro Industrial Group, in a letter to the current head of the Ministry of Security, requested to increase the credit limit of car manufacturers in the Money and Credit Council.

In a part of this letter, referring to the resolution of the Money and Credit Council to pay two thousand 500 billion tomans of facilities to this company, the amount of production of Iran Khodro Industrial Group in 2018 was announced as 393 thousand units and emphasized that this amount of production at the end of the year In the past, it has increased to 581,000 units, and this year's production plan is expected to be 800,000 units. With this trend, the production of this company has more than doubled since the last approval of the Money and Credit Council. Meanwhile, the price of production inputs in this period has increased by 26%, so the result of the two factors of increase in circulation and the price of inputs is 5.2 times, and the price of the order submitted by the Competition Council has also caused the loss of production operations in Iran Khodro Company and aggravates the need for liquidity and working capital. Therefore, it has been requested that the amount of 100,000 billion Rials of new facilities be approved by the Money and Credit Council for this year, and that the limit of Iran Khodro's obligations be excluded from the approvals of the Money and Credit Council and be placed at the disposal of the banks' board of directors.

At the same time, the foreign exchange needs of automobile manufacturers and the lack of supply by the Central Bank in recent times have also created problems and led to concerns about the possibility of not realizing the predicted circulation and responding to the obligations created. Therefore, the current acting head of the Ministry of Industry promised to supply the currency needed by car manufacturers and component manufacturers to alleviate the concerns in this field to some extent, but at the same time, the current statistics and figures of the costs and also the amount of production are based on The approvals of 2018 indicate that the need for liquidity of the automobile industry has quadrupled, while the approvals of the Competition Council in recent years have prevented the increase in the price of automobiles to such an extent that it has brought losses to automobile manufacturers, which is necessary for the government to enter In addition to providing the required liquidity, this issue should resolve the concerns of consumers and car buyers in the integrated car system, which is not a small demand, as quickly as possible, because otherwise we will have to witness a social crisis among the buyers of these cars.