The central bank’s foreign exchange for the import of electric cars

On the sidelines of the unveiling ceremony of the production line of Iran Khodro diesel electric buses, which was held in the middle of the week, the CEO of Iran Khodro announced the foreign exchange promise of the Governor of the Central Bank. Referring to his recent meeting with the Governor of the Central Bank, Alimardan Azimi said: Considering the supply of foreign currency needed by the sector [خودرو‌های برقی]The central bank will take effective measures. He emphasized: “According to the promise given by the Governor of the Central Bank, we can achieve 3 times what is expected by the end of the year.” Although the CEO of Iran Khodro did not announce the details of the promise of the Governor of the Central Bank, he said to Minister Samat (who was also present at the mentioned ceremony): Mr. Minister, the promise that [بابت خودرو‌های برقی]We gave, triple it.

Neither the CEO of Iran Khodro nor the Minister of Silence said what was discussed about electric cars between them, but in any case, considering the huge talk and also the promise of the Governor of the Central Bank, their backs have been warmed about this. This is in the situation that before the statements of the CEO of Iran Khodro, the head of Central Bank had announced the decisions of this bank to allocate currency to electric cars. According to the official website of the Ministry of Security, “an agreement has been reached with Abbas Aliabadi, the Minister of Security, regarding the provision of one billion dollars for the import of electric cars. In addition, Tehran Municipality has presented a package of one billion and 40 million euros to finance electric vehicles (buses, vans and motorcycles), which the Central Bank has accepted. With this account, the central bank has practically promised to allocate more than two billion euros of currency for electric cars to the Ministry of Security and of course to the car manufacturers and the municipality.

According to the statements of the Governor General of the Central Bank, it seems that the insistence of Minister Sammat on the development of electric cars in the country has entered a new phase, that is, if the promise of providing two billion euros of currency is fulfilled, a large number of electric cars can be imported. Of course, a part of the allocated currency may be allocated to the import of parts related to electric cars, and in this case, the potential number of electric car imports will be reduced.

Electric cars are inherently more expensive than gasoline models of the same class (it is said that there is a 30% difference in the price of electric cars compared to gasoline ones), so with two billion dollars or any other amount of currency, fewer electric cars will be imported compared to gasoline ones. If we assume, for example, that the average price of an electric car is 30,000 euros, with the two billion euros considered by the Central Bank, we can import nearly 67,000 units of this type of car. This is despite the fact that Minister Samat recently said that 100,000 electric vehicles (mostly in the form of taxis) will be imported by the end of the year. If we consider this promise, the import of 100,000 units by the end of the year requires consideration of electric cars with an average price of 20,000 dollars. Meanwhile, if we continue to consider the average base price of electric cars at 30,000 euros, probably more than 30% of the promise of 100,000 units will not be fulfilled.

With all this, what is currently considered as the main event is related to the issue of changing the approach of the Central Bank in allocating currency to car manufacturers. In other words, it seems that the central bank has facilitated the process of allocating currency to car manufacturers by restricting the production and import of electric cars. It is possible that there is a general agreement in the government on the development of electric cars in the country (considering its important benefits, including the reduction of air pollution and the reduction of fossil fuel consumption) and for this reason, the Central Bank has decided to allocate a separate currency for Targeted cars. Of course, the Central Bank had previously promised to provide one billion euros of currency for car imports, however, the process of cars entering the country does not show that this promise has been fulfilled. It was just two days ago that the customs announced that the total number of cars imported into the country in the eight months of this year was 3,488.

Of course, the customs did not say the total number of cars imported into the country after the liberalization of imports, however, there are two official and unofficial stories about this. The unofficial narrative, quoted by import activists, is that only five thousand cars entered the country. The official narrative is the words of the Minister of Economy, who announced the import of 11,000 cars to the country not long ago. If we use the same 11,000 devices as a criterion and assume that the average price of each imported car (according to the price ceiling) is a maximum of 20,000 euros, the Central Bank has provided only 220 million dollars (about one fifth) of the promised currency for car imports. According to the new promises of the Central Bank, now this bank has to provide more than two billion and 800 million euros for the import of cars (both electric and non-electric) (of course, if the new promises are to include only the import of complete cars and parts are included it is not).

Details of currency used by automakers.

But the car manufacturers have announced the amount of currency they used in the first half of the year in their consolidated financial statements for six months of this year. In the meantime, Iran Khodro has used various currencies including yuan, dollar, euro and dirham, the main share of which is related to the Chinese yuan. In the first half of this year, Iranian cars have consumed up to 592 million yuan. Their dollar consumption, however, has not even reached 3,500 dollars, yet the consumption of more than 14 million euros can be seen in their financial statements. Iran Khodro also consumed about 277 thousand dirhams in the first half of this year. Another big Iranian car manufacturer, Saipa, has also used Euro and Yuan in the first half of the year.

The currency consumption of this car manufacturer in the yuan sector has reached 293 million and 500 thousand yuan. Saipais have also spent more than 68 million euros in the first half of this year. According to published figures, the total consumption of the two largest car manufacturers in the country in the first half of this year was more than 885 million yuan. The total amount of euros spent by the two major car manufacturers has been announced as more than 82 million euros. Recently, the spokesperson of the parts manufacturers’ association announced that car manufacturers have registered an order of 544 million dollars for the import of parts from China.