Will the car industry transformation plan help the market?

According to Tejarat News, Minister Samat announced two days before the cancellation of the supply of cars in the Commodity Exchange that now there are doubts about this statement of the Minister. Alireza Razm Hosseini, during a visit to two major automotive groups in the country, announced the agreement of the Automobile Committee to cancel the supply of automotive products on the stock exchange and stressed that the members of the Automotive Committee concluded that the market should be regulated based on supply and demand mechanism. It does not make sense in the stock market.

What is clear is that Minister Samat, in his remarks, referred to the results of the car committee’s investigations and, according to the committee’s decision, announced the cancellation of the car supply in the commodity exchange. The question that arises is which car committee did the minister refer to?

Automobile Committee in the Ministry of Silence or Automotive Working Group in the Industries and Mines Commission of the Islamic Consultative Assembly, which in some cases is referred to as the Automobile Committee of the Assembly. If the minister means the car committee of the Ministry of Silence, then it should be said that this committee does not interfere in the “plan to organize the car industry and market” and its members are only consulting members of parliament and do not make decisions in this regard.

In other circumstances, if Razm Hosseini has announced the final result of the meetings of the Automobile Committee or Automotive Working Group of the Parliamentary Committee on Industries and Mines regarding the supply of cars in the Commodity Exchange, it should be said that some MPs announced yesterday that the plan will be reviewed.

In this regard, a member of parliament considers the supply of automotive products on the stock exchange to be the culmination of a car reorganization plan and emphasizes that if this clause is removed, the reorganization plan will be an incomplete plan. In any case, what is clear is that the announcement of this issue by Minister Samat is in the context that the Islamic Consultative Assembly, a few months ago, proposed the plan “Transformation of the automotive industry with a focus on the supply of domestic cars in the commodity exchange”. Publicly vote in the Islamic Consultative Assembly.

According to the parliament’s draft plan, the main carmakers were required to offer their products on the commodity exchange, while determining the base price of cars was left to the Consumers and Producers Protection Organization, and then the final price for sale was determined depending on the supply and demand of the exchange.

Also, if the plan is approved and implemented, the decision will be made to deposit the difference between the discovered rate and the base price in a fund to be spent on supporting matters such as providing car loans, modernizing the transportation fleet and also providing Qarz al-Hasna loans to car manufacturers. On the other hand, the Ministry of Industry, Mines and Trade announces the finalization of support packages to reform the automotive industry in the near future.

As can be heard, according to this plan, which is currently under consideration in the Economic Coordination Council of the heads of the three powers, the determination of the price of low-volume cars will be left to the automakers, and the high-volume cars will be in the hands of the Competition Council. With the final cancellation of the car supply on the stock exchange, we have to wait to determine whether the plan of the Ministry of Silence will be accepted and if approved, will it pave the way for this industry and its market or not? However, Minister Samat has sufficient confidence in the package proposed by his ministry to balance the industry and eliminate speculators.

Source: World Economy