Huffpost Business

Porsche Halts Car Sales In Iran

Posted: Updated:
PORSCHE IRAN SALES
Porsches outside a plant in Germany, waiting to be shipped to customers all over the world. | Getty Images

Porsche has joined Hyundai in its decision to cease selling cars in Iran, after a group called United Against Nuclear Iran (UANI) asked both automakers to stop.

A Porsche spokesman confirmed the company is no longer shipping to Iran.

"Consumers here have the power to force these companies out of Iran and tighten the screws on Tehran's regime," said New York City Public Advocate Bill de Blasio, who had teamed up with UANI to launch Iran Watch List. "Our message is clear: You can do business with the Iranian regime, or you can do business with the American consumer. But you can't do both."

De Blasio helped the group shine a spotlight on carmakers' Iran activities at the New York auto show earlier this month. He said in a statement that New Yorkers should be aware of their buying power and the impact it can have.

More than $17 million worth of Porsche vehicles were imported into Iran in the first five months of 2011, according to UANI. Eleven other foreign automakers are still selling cars in Iran: Fiat, Isuzu, Kia, Mitsubishi, Mazda, Nissan, Peugeot, Renault, Volvo, Suzuki and Toyota.

Iran's own auto industry has grown to become one of its major revenue centers despite international sanctions, some of which have been in place since 1979. UANI began its Iran Watch List in 2010 after discovering that much of the industry's money was going to fund the Islamic Revolutionary Guard.

In January, President Barack Obama enforced new sanctions against Iran's central bank, which serve to limit the country's access to foreign currency. The Iranian government, in turn, has imposed a ban on transactions in foreign currency. Those moves have been having an effect, particularly on the car market. Bloomberg recently reported that auto prices are soaring and Iranian auto sales are expected to fall 10 percent in 2012.

UANI said it remains concerned about sales of Volkswagen vehicles in Iran. Porsche owns a controlling stake in Volkswagen, which has a production license agreement with manufacturer Kerman Khodro Group. UANI said the Khodro Group and the Saipa Group are the two largest automakers in Iran and are both subsidiaries of the Iranian Development and Renovation Organization, which is sanctioned by the U.S.

UANI describes the Iranian auto industry as a huge support for the Iranian regime, because it is a massive source of revenue and because it helps the regime access foreign technologies that strengthen the military and security forces. After oil and gas, it is the nation's second most lucrative industry.

Iran's auto industry is also the largest in the Middle East and the 13th largest worldwide, UANI said. Many cars are imported into Iran, but many are made inside the country through joint ventures between Western or Asian automakers and Iranian businesses. About 1.6 million vehicles were built in Iran in 2011 through these joint ventures.

By comparison, China was the world's largest auto producer in 2011, making about 18 million cars and trucks. The U.S. came in second, at about 8.6 million vehicles for the year.

Around the Web

Porsche officially stops doing business in Iran

Porsche aims to double its sales by 2018 - The National

Porsche Shutters Operations in Iran | AutoGuide.com News

Porsche leads the way; pulls out of Iran- Others may soon follow suit ...

Porsche pulls out of Iran, will others follow?