Bloomberg News reported that Chinese companies are trading car parts for Iranian metals such as copper and zinc — part of a new barter mechanism between Beijing and Tehran designed to circumvent Western sanctions.
On Monday, October 6, Bloomberg reported that car parts manufactured by companies in China’s Anhui province — including Chery and Tongling — are shipped to Iran in semi-assembled form, while China receives industrial metals from Iran in return.
According to the report, this barter is part of a complex network in which cars are exchanged for metals or even agricultural products such as cashews — a system designed to evade restrictions imposed by U.S. sanctions.
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Bloomberg added that Chery Automobile does not trade directly with Iran; instead, it sells parts and technology to another company in Anhui province, which then exports the semi-assembled cars to Iran.
The report, citing informed sources, noted that U.S. and European sanctions against Iran target individuals and companies that use dollar or euro. Therefore, Chinese companies can legally trade with Iran as long as transactions are conducted in rials or yuan, without violating sanctions.
Under Chinese law, trade with Iran remains legal.
China’s Foreign Ministry told Bloomberg that it was unaware of such trade but stated that Beijing has always opposed illegal unilateral sanctions on principle.
In its IPO prospectus in Hong Kong, Chery announced that it would end its cooperation with Iran and Cuba by the end of 2024 and intends to minimize its operations in Russia by 2027.
Criticism of Chinese cars in Iran
The import of Chinese cars to Iran comes amid prior criticism from several lawmakers and trade officials.
In July 2023, Lotfollah Siahkali, then a member of Iran’s regime parliament (Majlis), protested the high prices of Chinese cars in Iran, saying: “The Chinese cars sold in Iran have a real value of 3 to 3.5 billion rials, but they are imported at 7.5 to 8 billion rials and sold in the market for 30 billion rials.” Currently, one U.S. dollar trades for about 1.12 million rials in Iran’s currency market.
Earlier, Mehdi Dadfar, secretary of the Association of Car Importers, criticized the ban on car imports and the resulting dominance of Chinese vehicles and parts in Iran’s market.
He said: “They worked very hard to block imports so that global brands wouldn’t enter the market — and they turned us into one of China’s provinces. Even in China’s own auto shows, you don’t see this many Chinese cars.”
Kamal Hadianfar, head of Iran’s regime traffic police, also previously criticized domestic automakers for their dependence on foreign parts, saying: “Someone should ask our car manufacturers why they import parts from China.”
