What become of car symbols after the liberalization of car imports?
According to Tejarat News, the plan to liberalize car imports was approved in the open court of the parliament a few days ago. However, the Expediency Council opposed the plan and it is currently suspended.
According to many experts, with the liberalization of car imports, the price of cars in the country is moving towards realism, and incidentally, it is not a barrier to the competition of domestic cars. But if this plan is implemented, what effect will it have on car stocks?
Nima Mirzaei, a capital market expert, told Tejaratnews about the impact of the car import liberalization plan on the automobile group: “The automobile import liberalization plan created a wave of positive and negative reactions among economic actors, including the automotive group shareholders.” A plan that seems to have a difficult and ups and downs path until the final approval and notification, and at the very beginning, its winning path, which was the import of a second-hand car, was eliminated! But if passed in the same way, it will have two disproportionate effects on the automotive group and parts manufacturers.
Mirzaei says: “Its positive effect is due to the stipulation that one of the conditions for importing a car is the currency due to the export of cars or parts, and this creates a privilege for domestic companies and naturally, considering the potential attractive profit of imports, Will put the financial statements of automakers and their subsidiaries.
Regarding the negative impact of this issue, he said: “The negative impact, however, is due to the opening of foreign competitors (including cheap Chinese) to Iran’s virgin market and price competition with domestic products.” According to the upstream agreements, the luxury segment car was to be imported and low-priced products (with the aim of supporting domestic production) to be produced exclusively domestically. The issue to be seen will be repeated this time?
Competition Council is the scourge of car imports?
In another section, the market expert said: “The outcome of these two opposite effects determines the direction of movement of automakers in the stock market, an outcome that is more inclined to the downward trend.”
An important control tool has also been provided to the Competition Council, which sets a ceiling on the number of cars every six months, a council that has not previously been very competitive with automakers, and this time can effectively sterilize the plan if the import ceiling is lowered.
He emphasized: the analysis of an industry or share needs a comprehensive study in various fields. For example, in the automotive industry, “Borjam” and “entering the commodity exchange” along with the subject of this discussion are among the most important influential factors.
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