Azernews.Az

By Sara Rajabova

Foreign companies are lining up to resume their activities in the Iranian market ahead of the removal of international sanctions imposed on the Islamic Republic over its nuclear energy program.

Russian automakers AvtoVAZ, GAZ and KAMAZ are holding negotiations on the setup of a Russian vehicles’ assembly in Iran, TASS reported citing the Iranian ministry of economic development.

"Several Russian automobile companies are currently holding negotiations with the Iranian side concerning the setup of Russian vehicles’ assembly in Iran [AvtoVAZ, GAZ, and KAMAZ at the initial stage — TASS]. However, no specific agreement has yet been reached," the ministry said.

European and U.S. automakers are also competing to gain a footing in the Iranian market.

France’s giant carmaker PSA Peugeot-Citroen, which stopped its trade with Iran in 2012 after the enforcement of U.S-led financial sanctions against Tehran, has reached an agreement with Iran’s leading car-maker, Iran Khodro - IKCO for the establishing of a joint car manufacturing factory in Iran, according to Iranian media.

The ministry of economic development said Russian companies will be challenged by major competitors represented by European and U.S. automakers already having a track record at assembling their models in Iran should sanctions be lifted.

The setup of Russian vehicles’ assembly facilities was discussed during the visit of the Russian Minister of Economic Development to Tehran in November 2014.

Russian automakers said earlier they intend to compensate their losses from declining domestic sales on the account of export, focusing on traditional markets in CIS and emerging markets in Asia, Africa, and Latin America.

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Sara Rajabova is AzerNews’ staff journalist, follow her on Twitter: @SaraRajabova

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