Media outlets in Iran report that the prices of many domestically produced cars have increased by 3 billion to 10 billion rials in less than two weeks. (Currently, the dollar price in Iran’s market is around 1,800,000 rials.)
The state-run Mehr News Agency wrote that during this period, even some car models such as Tara and Rira saw price increases exceeding 10 billion rials (approximately 5,587 dollars).
Prices of Iranian-Made Vehicles Jump by 50% in Less Than One Year
According to reports, in Iran’s car market between April 16 and April 30, an unprecedented trend of price surges was recorded across nearly all vehicle categories, from domestically produced cars to assembled and imported models.
Automotive experts and experienced market participants, who themselves have been surprised by the situation, told domestic media that this unprecedented price growth indicates the market, after a period of relative stagnation during the war, has re-entered a phase of volatility and widening price gaps.
Saeed Motameni, the former head of the Tehran Car Dealers Union, said that Iran’s car industry, which had been moving toward becoming a consumer market, has once again turned into an investment asset for preserving monetary value.
Motameni also emphasized that many buyers, due to reduced purchasing power, are unable to afford cars… only a small segment of society remains active in the market… approximately 10% to 15% of the population, while the majority of people cannot afford to buy or sell cars.
Why have car prices suddenly increased so sharply?
Automotive industry experts report an unusual situation in the car market; neither sellers are willing to transact, nor buyers have the financial ability to purchase.
Automotive experts, in interviews with media outlets, cite the consequences of the war and U.S. and Israeli attacks on Iran as one of the main reasons for this price increase.
The state-run Eghtesad Online website wrote that damage to the main supplier of steel sheets needed for car manufacturing on one hand, and disruptions in petrochemical production on the other, are undeniable factors behind the runaway increase in car prices.
As one of the most widely used and in-demand goods in the market, cars have inevitably been affected by recent developments. Damage to parts of the steel and petrochemical industries—especially sectors involved in automakers’ supply chains—is already showing its effects on production lines.
Meanwhile, the state-run Tasnim News Agency, quoting Mohammad Atabak, Iran’s Minister of Industry, Mine, and Trade, reported that planning for supplying the steel sheets required by automakers has been completed through the end of the year and their provision is guaranteed.
According to this news agency, last week 164,000 tons of steel sheets were offered, of which only 92,000 tons were sold.
At the same time, the reduction in car imports due to blocked import routes has also contributed to market volatility. As a result, prices of assembled and imported cars have also seen significant increases over the past two weeks.
According to Hadadi (an Iranian official or market figure), under current conditions, car imports are not the country’s top priority. Therefore, although imports will not stop entirely, they will certainly be more limited than before. Due to import restrictions, challenges may also arise in supplying parts for assembled vehicles.
On the other hand, the surge in foreign currency prices has also fueled the runaway increase in car prices in Iran, and Ezzatollah Zarei, spokesperson for the Ministry of Industry, Mine, and Trade, stated that the ministry has authorized price increases for automakers’ products.
He said: “In the automotive sector and all goods, we have a logical price adjustment. We have changed the exchange rate basis for calculating import duties and wage rates, and naturally this affects product prices. Apart from this logical price increase resulting from changes in production and import-related factors, we will not have any other price increases.”
The role of middlemen and the Ministry of Industry
However, a number of Iranian media outlets report that middlemen have entered the car market and are listing unrealistic prices for buying and selling in order to prepare the market mindset for further price increases.
According to these reports, these groups are trying to exploit the current instability and public fear about the future, aiming to turn at least 30% to 40% of these artificial increases into real profit.
The state-run Tabnak website also reported that a weekly increase of 3 to 5 billion rials (approximately 1,676 to 2,794 usd) is not consistent with any production logic, even considering rising raw material costs, and is instead due to severe monopolies and closed borders to large-scale, real imports.
The outlet added that the Peugeot 207 reaching a price of 30 billion rials (approximately 16,760 USD) is a bitter historical milestone. This means a car considered inexpensive and suitable for students in global markets is being sold in Iran at the price of a luxury European car, and at global rates.
