Renault may re-enter Iran once trade sanctions against the country are lifted with the auto market expected to gain by at least 50 percent, chief executive Carlos Ghosn said. He said at the World Economic Forum in Davos, Switzerland that the lifting of economic sanctions would benefit Renault since "French brands have always been very popular" among car buyers in the country.
"Even with all the sanctions, the Iranian market represents 700,000 to 800,000 cars," Ghosn noted in a Bloomberg Television interview, adding that once an agreement is in place allowing resumption of trade, Iran’s new-car market could jump to between 1 million and 1.5 million cars.
Renault halted sales of component kits for assembly in Iran in 2013 because of trade sanctions. Renault posted a 3-percent rise in global sales in to 2.63 million cars and light commercial vehicles, but could have sold more if it had not stopped selling them in Iran.
The carmaker sold 64,500 vehicles less in 2013 compared to 2012, Renault said on Jan. 21.
The termination of operations in Iran led to EUR512 million ($698 million) in first-half provisions, which contributed to a 95-percent drop in net income in the period.
Iran is in discussions to relax trade and financial sanctions imposed, hurting global deliveries in 2013 at PSA/Peugeot-Citroen.
Ghosn remarked that the presence of Iranian President Hassan Rouhani at the Davos conference "is great news" and shows that talks on resuming international connection are "well engaged."