Iranians Boycott Domestic Cars

(Peugot Pars production line; French companies enjoyed a special position in the Iranian auto industry before tightening of nuclear sanctions; Photo: Reza Dehdari/Mehr News Agency)

Around one month ago, Iranians started circulating messages in their Telegram^® apps, inviting compatriots to boycott the purchase of brand new domestic cars (or ‘zero cars, as they are called in Iran). The message claimed that with the lifting of sanctions, cheap, high-quality foreign automobiles are on their way to the Iranian market; and can replace the current Iranian productions.

For years, Iranians have been complaining about low-quality, over-priced products of the domestic automobile industry. Despite a regionally unparalleled history of nearly half a century, Iran’s automobile manufacturing industry has been emboldened by protectionist policies, following a consumer-unfriendly attitude in both production and delivery of its products.

Following the financial sanctions imposed against Iran in 2012 which led to devaluation of the Iranian currency of Rial, the two Iranian automobile giants, Iran Khodro and Pars Khodro (‘khodro’ means automobile in Persian) seized the opportunity and doubled the price of their cars, despite widespread objections. As Manouchehr Manteghi, former CEO of Iran Khodro, admitted in an interview last year, the reasonable price hike after Rial’s crash would be seventy percent.

However, it seems that for the first time in years, the balance has tilted in favor of customers. With the boycott campaign snowballing, the media have doubled their focus on the issue, and in general, they have sided with the consumer market, despite typical arguments which attempt to tie the domestic automobile industry with national pride and self-reliance.

An important turn in the story was the provocative remarks by veteran minister of industry Mohammad-Reza Nematzadeh, who took the confrontation to an entirely new level, and called the proponents of the boycott movement ‘traitors’ and ‘counterrevolutionaries’. Adding insult to injury, the octogenarian minister’s statements sparked harsh responses from both the media and the public (a report on Nematzadeh’s remarks in the conservative website Alef’s received 622 comments, nearly all of them critical).

“Know your limits Mr. Minister” read a piece in Asr-e Iran, website affiliated with parliamentary speaker Ali Larijani. The Principlist news agency Fars also questioned the minister about the relation between boycotting home-made cars and being a counterrevolutionary. A video footage was released a few days later, comparing Nematzadeh’s recent remarks with what he said in 2005, when he lamented the fact that Iranians do not unite and react to price hikes, even if as slight as 2-3 percent.

The government also tried to do some damage control, with news coming of Hassan Rouhani admonishing Nematzadeh to deal with critics respectfully.

The nuclear deal has raised hopes among Iranian citizens for a better economic prospect and renewed access to foreign consumer goods. It seems that with news of successive trade and industry delegations from countries such as Germany, Japan and France visiting Iran, consumers have found the opportune moment to take the unfriendly domestic car industry down a peg or two.