Auto industry sacrificed to politics/ will automakers losses continue?

Khodrocar - Disagreements over the new car price at the Market Regulation Headquarters have postponed the decision until the next meeting. It is reported that the dispute between the members present at yesterday's meeting of the Market Regulation Headquarters has caused the car price instructions to remain unresolved, while in this meeting, the Secretariat of the Automotive Market Regulatory Committee reported on the policy processes and regulations of this sector.

The guidelines for determining car prices have been read by the Deputy Minister of Industry, the National Competition Center and the Consumers and Producers Protection Organization, but differences between members present at the meeting have left the car price guidelines unresolved and postponed to future meetings.

This is despite the fact that it has been predicted that it will not be possible to reach a definite conclusion in this regard in one meeting. Opposition to the car's price is said to have been so great that it was finally decided that the reports provided by the experts would be further evaluated.

Pricing in the automotive industry, which has become a comedy in recent years, has not only damaged the industry, but also pushed development plans and product diversity into the abyss of destruction.

Although automakers and parts manufacturers want to set prices on the margins of the market and eliminate mandatory pricing, it seems that this will not be easy due to what happened in the car market last year, while the Competition Council also In the last months of the year, he announced his return to the pricing field. But at the same time, automakers have made proposals to shorten the council's hand in pricing to prevent further damage.

The justification of car manufacturers for handing over and determining the price in the margins of the market is a successful experience of the 70's and although in February 2016 the Ministry of Industry, Mines and Trade announced that car manufacturers can set the price of their products in the margins up to 5% below the market rate, but this The decision, which was considered a kind of quasi-liberalization in the car market, did not last long, as this decision greatly increased the commercialization and mediation in the market, and ultimately led to unbridled prices in the car market. Therefore, in the last months of last year, it was announced that the Competition Council would return to the field of car pricing.

Experts believe that the return of the Competition Council to the field of car pricing will intensify the market excitement, because with pricing, guaranteed profits will be given to those who enter this market, and on the other hand, we will see an unreasonable increase in prices in the market. This has already happened. At the same time, the losses to automakers and the tensions we will see below, including declining production capacity, are another blow to orderly pricing.

Emphasis is now being placed on focusing on production rather than the market, and this is seen as an economic solution. Automakers also believe that if the pricing trend continues this year, we will see more bankruptcies and losses, followed by a reduction in the ability to pay the claims of parts manufacturers. However, a large part of carmakers' losses last year go back to the issue of pricing.

It seems that with the trend of yesterday's market regulation meeting, the pricing, priority and policy of the Ministry of Silence as well as the Competition Council will be this year, because this policy has been emphasized before. Now we have to wait for next week and the next meeting of this council and the decision has been made.