Khodrocar - While the news suggests that the exchange rate is likely to change the rate of customs duties on raw materials as well as vehicle clearances, industry activists believe that if we do, we will see a rise in the price of finished parts as well as automobiles, which could go hand in hand with pricing. This could lead to further damage to automakers.
"As costs rise, we will see an increase in the cost of manufactured parts, as customs duties will double and the price of car parts sold to the carmaker will change.” Mehdi Taleb Zade, member of board of part makers association told khodrocar reporter.
"Since some of the raw materials of automobile parts are supplied through imports to achieve the internalization process, any change in the calculation of this rate and a doubling of the amount of these charges can lead to higher costs and ultimately have an effect. It will cost the car more.” He said.
"Currently, ready-to-import parts are being imported to the country only partially due to the launch of deepening tables inside many imported parts being internalized and invested by local part-makers. The fourth table will enter the operational phase in late February.” He added.
"Changing the rate of customs duty calculation from 42000 Rials to NIMAY currency will see a threefold increase in prices that will have a devastating inflationary effect.” He said.
"Selling a car at a certain price and increasing production costs and costs, on the other hand, will only be a detriment to the manufacturer, while the car industry's raw material prices are now in line with world prices and the free exchange rate, leading to losses.” He mentioned.
"The piece maker is a private firm and does not receive government backing. They can’t continue by high losses so they will ask automaker to increase prices with reasons and the automaker have to pay more.” He said.
"Since current formulas do not allow sales to rise in price, the loss to the carmaker is likely to increase, due to a faulty ordering cycle that if the model is eliminated from the pricing, even a 20% increase in tolls would apply to the automotive industry.” He said.
As the automotive industry seeks to reduce production costs with the development of internalization, implementing off-the-shelf decisions imposes high costs that need to be increased by the cooperation and coordination of relevant institutions.