The value of automakers’ shares in stocks is decreasing and shareholders are really worry about the future but the question is what is the reason of this decrement and why the government is not doing anything about it?
Khodrocar – In recent months the condition of the shares of automotive groups was not very well. According to the financial statements IKCO as the biggest automaker in Iran suffered a loss of 25670 Billion IRRs meanwhile their capital was 15300 billion IRRs so they suffer a loss more than their own capital. About the SAIPA, according to what securities and exchange organization said in the first 6 months of the year they suffer a loss of 29000 billion IRRs meanwhile their capital was 39300 IRRs. Also the loss of all automakers and part makers in the first half of the year show the problems of this industry and it may knockdown the whole industry.
"Part of this losses belong to past but they were accumulated and lowered the production power of automotive groups. Most of automakers’ debts belong to the part makers and the other part of it is because of the high final price and selling prices. They also have to struggle with importing parts with higher prices and finally shareholders are disappointed in the exchange market.” Ali Sadeqian, expert of auto industry told Khodrocar reporter.
"In the last decade, automotive industry has been one of the most damaging industries in the country. Most of the debts are belong to the past and also their non-productive finance is too much and it doesn’t count as a working capital. Also prices should be corrected and the current prices are not enough for automakers.” He added.
"Except from the sanctions which is affected the costs alongside the accumulated debts, most of these losses are related to the part industry. Auto industry is using metal as the first material so the increment in price of metals in the past year has increased the costs for automakers. If we add the increase in the exchange rate, the cost of production has increased considerably. But the price of cars are not so attractive to cover these costs.” He said.
"Maybe sanctions finish next year after some negotiations. If the foreign investor enter the country, effectivity increase by importing new technology, lower of global prices and all other conditions happen then we may see a balance and stable condition in the industry.” he added. "Also a liquidity from the government and banking system can help the industry to prevent the bankrupt.”
"If this does not compensate for losses, car groups will be subject to Act 141, and then the government should think hard on this issue. I think one of the priorities of the new minister should be strengthen the automaker financially and support them.” He continued.
According to the financial statements of exchange organization the losses of IKCO and SAIPA was more than 50 percent of their capital and they will be subjected to the law 141 of trading. According to this law the board of members should have a meeting about the continuing or breaking up the activity. However the profit or loss of a company will be calculated according to the annual financial statements, so we have to wait till the end of the year but as it seems their activity won’t be better in the second half of the year and we may see them closing their doors at the end of the year.
Khodrocar Reporter: Sepideh Ghazi Nejad
Khodrocar Translator: Amin Zamani
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