French companies have begun to take the opportunity provided by the removal of sanctions against Iran to do some big business with the Iranian companies.
PSA Peugeot Citroën signed a deal worth 400 million euro on Thursday with Iranian counterpart Khodro, an automotive company that is partially owned by the government.
Peugeot Citroën will start to produce cars in the Islamic Republic nation once again following a four year absence.
The deal, comes just one week after economic sanctions were lifted against Iran as part of a controversial nuclear deal signed by Iran and world powers in July.
The contract, along with several other major business deals between France and Iran was signed at a special ceremony that took place in Paris with the visiting Iranian President Hassan Rouhani.
A chief executive at Peugeot, Carlos Tavares said, “We are coming in hopes of a very long-term relationship. We will be present in this country in a very profound manner.”
Khodro is the largest car maker in Iran and was the historic partner for Peugeot before the French company’s decision to shut down its operations in 2012 in the wake of international sanctions.
Peugeot had closed down its operations four years ago in spite of having the largest market share among foreign car makers.
Iran was Peugeot’s second biggest market, following behind only France. The car manufacturer would have preferred to not have left. “We too were victims of international sanctions,” said Tavares.
The President and cheif executive of Khondro, Hashem Yekehzare, said “the strategic partnership with [Peugeot] will serve as a unique platform, for both parties to capitalize on each other’s competitive advantages; especially given the scale.”
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