Skip navigation
Newswire

UPDATE 2-Renault seeks financial partner to resume business in Iran

* In talks with U.S., French governments over Iran

* Has been approached by Turkish, international banks (Adds Renault executive comment on Latin America)

By Evren Ballim

ISTANBUL, June 19 (Reuters) - French automaker Renault is looking for a financial partner to resume full operations in Iran and is in talks with the U.S. and French governments on the issue, one of its senior executives said.

Renault is keen to start making and selling vehicles in Iran again with local partners Iran Khodro and Pars Khodro, to rebuild the significant market position it enjoyed before international sanctions on Tehran were introduced in 2011.

French rival PSA Peugeot Citroen also wants to ramp up sales in Iran, which analysts say could be a profitable, fast-growing auto market soon exceeding 2 million vehicles annually in the event of a sustained diplomatic thaw.

"What we are looking for is a financial partner, who will on their own as well comply with all the international regulations and which enable us to resume our activities in Iran," Chief Performance Officer Jerome Stoll said in an interview with news agencies late on Wednesday.

"We are just trying to explain our position to the American administration, French administration as well. To explain what we want to do, how we want to proceed and how we want to make this business," he said.

Stoll said the company had been approached by Turkish and international banks.

Renault said in January it had resumed shipments to Iran and expected its car production in the country to pick up progressively throughout the first half of 2014.

At the time the company said a temporary easing of sanctions had begun to allow a "very low" volume of parts shipments for vehicle assembly in Iran. It is keen to reclaim its market position before the mass arrival of competitors behind any permanent political detente that could follow.

Production by Iran's domestic car industry, unusually developed for the Middle East, peaked at 1.6 million cars in 2011, the year crippling new sanctions were introduced. Leading manufacturer Iran Khodro accounted for about half that output.

Stoll also said he expected a recovery in the Brazilian auto market but was concerned about Argentina, which threatened to default on its debt on Wednesday.

Renault, which has factories in Brazil and Argentina, made 14 percent of group revenue from Latin America last year.

"I expect the Brazil market to recover in the coming months.... We have a lot of concern in Argentina on the financial situation," Stoll said.

"The two countries have some links. If one country is suffering it may affect the other. So I'm a little bit concerned by the situation today in Latin America in the short term."

Stoll also said Renault planned new investment in its Oyak Renault unit plant in the northwestern Turkish city of Bursa. (Writing by Daren Butler; Editing by Nick Tattersall and Erica Billingham)