The Forum for Partners in Iran's Marketplace

September 2017, No. 85

Trade & Business

Iran, Austria to Produce Fuel-Efficient Cars

Iran’s Minister of Industry, Mine and Trade Mohammad Reza Nematzadeh said Iran and Austria have agreed to manufacture fuel-efficient cars.

Speaking at a meeting with an Austrian delegation in Tehran (early June), the minister noted that the agreement is part of a bilateral cooperation accord which was reached a year ago.

“The contract, signed last year between an Iranian firm and Austria’s ABL research center, has fortunately yielded results as a prototype of fuel-efficient car engine which will be soon unveiled while mass production is expected to begin within two years,” highlighted the minister at the meeting with Austrian Federal Minister of Finance Hans Jörg Schelling, who headed a delegation of senior financial and economic officials to Iran.

Nematzadeh went on to note that the three-cylinder engine will be used in future cars in a bid to reduce fuel consumption and preserve the environment. “Similar talks have been held with Germany to manufacture Euro-VI engines,” he said.

The minister reiterated that Iranian auto companies are in talks with their Austrian counterparts for supplying spare parts, adding that contracts with countries such as Austria will contribute to promote Iran’s auto industry.

He added that such agreements are among the achievements of the Iran Nuclear Deal (an international agreement reached in Vienna on July 14, 2015 between Iran, the P5+1 and the European Union.

Iran and the five permanent members of the United Nations Security Council — the United States, France, Britain, Russia and China — plus Germany started implementing the accord known as the Joint Comprehensive Plan of Action (JCPOA) on January 16, 2016.

Since then a large number of international auto companies have expressed willingness to either resume or boost cooperation with the Islamic Republic.

He pointed to the launch of cooperation between Iranian and Austrian banks saying “some members of Central Bank of Iran (CBI) staff are undergoing training courses in Austria and the remaining issues will be hopefully resolved.”

Iran’s industry minister reiterated that no legal barriers existed on development of banking relations between the two countries as Iran has remained committed to global banking regulations.

“Austria’s Export Credit Agency (ECA) has confirmed a number of Iranian investment projects in steel and auto part sectors,” said Nematzadeh, stressing that the European country has agreed to provide insurance and finance worth 780 million euros for creating steel sheet production line at Iran’s Golgohar.

He noted that Iran will remain committed to joint five-year plan which was defined and inked during the last year session of Iran-Austria Joint Economic Commission.

Also at the meeting, Austria’s Schelling pointed to age-old history of relations between the two countries, voicing optimism that bilateral ties will return to pre-sanctions levels.

The Austrian finance minister said he was being accompanied by governors of some large banks adding “monetary transactions and expansion of turnover are subject to the banking system.”

He noted that his country’s banks have launched working relations with 20 Iranian counterparts asserting “we spare no effort to supply legal security for bilateral and multilateral relations with Europe.”

He called for formation of Iran-Austria Joint Economic Commission and suggested an analogy between taken measures and a marathon explaining that “we are reaching the finishing line, thanks to political determination and support of Iranian and Austrian governments.”


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  September 2017
No. 85