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U.S. Trade Sanctions May Prompt Renault to Exit Iran
Renault SA says it is likely to abandon the Iranian car market to comply with U.S. trade sanctions, even though the carmaker does no business in the U.S.
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Renault SA says it is likely to abandon the Iranian car market to comply with U.S. trade sanctions, even though the carmaker does no business in the U.S.
Thiery Bollore, the company’s chief operating officer, tells analysts that Renault is considering alternative opportunities, including expansion in Africa.
The company’s pending exit from Iran follows a similar decision by rival French carmaker PSA Group to shut down operations in the country by Aug. 6. The two companies had planned to add a combined 300,000 units of local production in Iran.
Renault, which had been assembling cars in Iran through partnerships, was pursuing plans to raise its output there by 75%. That initiative is still in the planning phase.
Renault has no presence in the U.S. market. But Bloomberg News says the company’s decision is being driven by Renault’s controlling interest in Nissan Motor Co., which operates factories in the U.S. and sold nearly 1.6 million vehicles there last year.
The Iranian market reopened in 2016 after previous trade sanctions were lifted. But the U.S. reinstated the restrictions in May after President Donald Trump pulled out of the nuclear agreement that had reopened Iran to global trade. Earlier this month the Trump administration rejected France’s request for an exemption from the new sanctions.
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