According to a recent report by the Iranian Parliament Research Center on the automotive industry, 926,000 vehicles were produced in the past Iranian calendar year 1404 (which ended on March 20). This figure represents a decrease of 17.4% compared to the previous year.
IRNA reports that the comprehensive overview of production, imports, exports, and scrapping of old cars, presented in the Parliament Research Center's report, shows that in 1403, production reached approximately 1,121,000 units, while last year it fell to 926,000, a drop of more than 17%.
Although there are multiple reasons for the decline in production, supply chain disruptions and various imbalances observed in recent years have been cited as the most significant factors.
Import and Export Dynamics
According to published statistical data, the volume of imports in 1404 reached about 67,000 units, indicating a growth of 6.3% compared to the 63,000 cars imported during the same period in 1403. However, export value in 1404 decreased by 48% relative to 1403. Last year, the export value in the automotive and auto parts industry amounted to approximately 65 million US dollars, whereas in 1403, this amount was about 126 million dollars.
The scrapping of old vehicles last year totaled 204 units, which is less than the 350 units in 1403, reflecting a decline of 41.7%.
New Scrapping Policy
The 14th government's policy aims to accelerate the process of scrapping old cars. In this regard, the Organization for Development and Modernization of Iranian Industries (IDRO) has been tasked with implementing this plan. Thanks to recent amendments to the executive provisions of the Automotive Industry Law, Article 10 is expected to increase the country's annual scrapping capacity to over 350,000 units.
One of the most important changes in the new regulations concerns Article 15. Previously, one vehicle had to be taken out of circulation for every 12 produced. However, according to the new amendments and the note to Article 10 of the law, this ratio has been changed to one vehicle for every four, meaning that manufacturers must compensate 25% of their monthly output by scrapping old models.
Furthermore, in the car import sector, hybrid models received a 50% exemption, and domestic electric vehicles received a 100% exemption from scrapping fees to facilitate the entry of environmentally friendly vehicles into the country.
Providing financial incentives for scrapping old transport also contributes to modernizing the transport fleet, reducing air and environmental pollution, and improving fuel consumption management.