By on November 7, 2013


An obscure story in the Azerbaijani press this past summer may be the tip of a much larger iceberg involving General Motors, PSA Peugeot Citroen and the Western World’s current bete noir: the Iranian regime currently embroiled at the heart of a controversial nuclear program, which is subject to economic sanctions by the United States government, including those that specifically target Iran’s automotive industry.

Citing reports from Iran’s Mehr news agency, an Azerbaijani news outlet reported that an unspecified number of brand new Chevrolet Camaro RS 2LT convertibles were imported by a division of Iranian conglomerate Iran Khodro. According to the report, the Camaros were sent from Miami to Paris, and then from Paris to Tehran via a Qatar Airways plane. The report also states that US Customs and Border Patrol documents list the final destination as the Aras Free Trade and Industrial Zone.

Iran Khodro, which manufactures automobiles in Iran, is among the Iranian industrial entities that has been hit hard by American sanctions against Iran, including those that specifically target its auto industry, which some parties allege is a “major procurement network that imports material and technologies used to build uranium centrifuges instead of cars.

Given the serious penalties for violating sanctions against Iran, it seems unthinkable at first glance that General Motors vehicles would be exported to Iran for sale without any consequences. GM even stipulated that PSA suspend doing business with Iran and IKCO as part of its alliance agreement with PSA, an agreement that seems to have stalled at this point. But a deeper dive into the matter reveals a much more complex picture, one that sheds more light on GM’s future positioning in emerging markets, its dealings with Iran itself, and what may be the true nature of its alliance with PSA.

The ties between PSA and IKCO have historically been very strong. Most of IKCO’s cars were Peugeot vehicles of varying ages, branded as Iran Khodro or Peugeot vehicles, and built in Iranian factories. In a market of 1.12 million units annually, IKCO had production capacity for a million units per year, with IKCO and PSA’s joint venture ruling the vast majority of those sales, while their factories ran very close to capacity in previous years. PSA alone accounted for roughly 458,000 units sold in Iran, while PSA rival Renault also had a strong interest in Iran, selling 100,000 units per year, until it withdrew from the country, citing fears of violating U.S sanctions as a reason for walking away from the Iranian market.

Now, various French news outlets, including Le Figaro, a respected daily newspaper, are accusing General Motors of intentionally gutting PSA’s ability to do business in Iran, while attempting to establish its own partnership with IKCO, as a means of securing a strong footing in the up and coming Iranian market, one that Boston Consulting Group estimates is good for 1.5 million units per year by 2020, making it one of the strongest of the “Beyond BRIC” countries.

Le Figario states that

Iranian automotive industry is particularly courted by General Motors . The giant came into contact with Iran Khodro, which worked until 2012 with Peugeot to produce 206 and 405 models that the French group has stopped delivering to Iran because of Western sanctions imposed on Tehran for its nuclear ambitions . “For at least six months as emissaries of General Motors go to Iran, they are no longer the simple identification of the market,” warns the industry, “but rather to the draft contract resumption of GM “, which was firmly established in the time of the Shah.

Le Figaro alleges that GM is not the only company to be looking to Iran if and when relations between America and Iran thaw amid a resolution over its nuclear crisis, but it does call out an ad campaign on behalf of GM undertaken by an Iranian law firm – other reports also point to a social media campaign designed to target Iranian consumers on behalf of GM. Other allegations leveled at GM include the use of emissaries on behalf of GM visiting Iran and IKCO as part of a broader push to undermine established French business interests in favor of American companies in preparation for the resumption of commercial dealings with Iran. One source cited by Le Figaro doesn’t think that this was a mere coincidence. The source claims that Executive Order 13645 is

“…a real cleansing of the Iranian car market as it prepares to make way for U.S. manufacturers before a political deal between Tehran and Washington.”

Upon closer examination, sale of the Camaros appears to be allowed under a loophole in Executive Order 13645 , which punishes any foreign entity that sells or supplies parts or services to Iran’s automotive industry (specifically its manufacturing sector) but does not prohibit supplying Iran with assembled vehicles.

During the initial stages of the tie-up, the alliance between GM and PSA was difficult to discern. Beyond vague platform sharing and purchasing agreements, there seemed to be few synergies that made such an alliance worthwhile. By the Iranian angle adds context to the entire affair.

By putting pressure on PSA to end its relationship with IKCO, GM gave America a way to keep the heat on Iran’s economy while also cutting off an artery for hard currency via reduced vehicle exports. At the same time, it was able to cripple an already ailing partner by cutting it off from one of its better export markets, and a growing one at that. Before the alliance had even been former, our own global sales reports showed that sanctions and other economic factors had been effective at gutting Iran’s automotive market, composed largely of locally built IKCO/PSA products. The departure of Renault was another positive development for GM, with the French auto maker walking away from 100,000 units annually. Altogether, the absence of the two French players leaves a 585,000 unit hole in Iran’s nearly 1 million strong auto market, one that GM is primed to capitalize on if and when things get less frosty and trade relations between the two countries open up .

Many observers feel that Iran’s Islamic regime is living on borrowed time, thanks to a relatively young population that is plugged into Western popular culture – these same people came very close to toppling the regime just a few years ago. And while regime change doesn’t seem to be in the cards anymore, then the very sanctions designed to bring the regime to its knees might at least foment some sort of normalization of relations in exchange for the forfeiture of Iran’s nuclear program, along with a new, more moderate ruler (though Iran’s unelected religious leaders still hold all the power). Such vast numbers of young people with rising economic prospects and families of their own on the horizon will be perfect consumers for a large number of automobiles in the future, and who better to serve them than General Motors?

The timing is likely to be fortuitous, as Iran’s auto market is expected to grow by another 500,000 units, to roughly 1.5 million units by the end of the decade. GM’s push won’t be centered around Camaros either. The General has a number of Chinese brands selling cheap, compact vehicles that can go head to head with Chinese brands like Great Wall that are already established in Iran. If GM really does make a big push into Iran, brands like Wuling and Baojun will be just as important as Chevrolet and Buick, and will likely be part of an attempt to capture a substantial amount of volume by utilizing multiple brands in GM’s portfolio to help capture various market segments from compact low-cost cars to flashier fare to the smaller commercial vehicles that brands like Wuling are known for.

Platform sharing, the oft reported cause of death of the GM-PSA alliance, may have been a red herring all along. GM could possibly have decided to abandon the alliance, or any pretense of it, after getting what they came for: in this case, an express pass to a promising emerging market that isn’t a BRIC country. But don’t count PSA out just yet. Recent talks with Chinese auto maker Dongfeng could allow it to get back in the game in Iran, free of any concerns about violating U.S. sanctions.

Get the latest TTAC e-Newsletter!

36 Comments on “Iran’s Imported Chevrolet Camaros Raise Questions About GM’s Dealings With PSA And The Iranian Regime...”

  • avatar

    Same old, same old…

  • avatar
    Athos Nobile

    Derek, many things get into Iran in sometimes serendipitous ways. Years of sanctions have made them creative and resourceful. Not only to go around the sanctions, but also to learn how to make the stuff in their own land.

    You can buy a good price American-branded laptop in Tehran with no issues.

    More than a market with 1.5M units (which is really chump change), the big elephant in the room here is that they have an industry capable of 80%+ localization (i.e. they can manufacture a complete car), plus R&D capabilities, relatively low cost and located in a great spot in the Middle East and North/Mid Africa. No need to setup anything as the skills set and know how is already there.

    I think that’s what GM (or any other smart OEM) is after. That the Persians are also allies with the Chinese further sweetens the deal.

    I honestly don’t think the Iranian government will relinquish all that and allow a flood of “cheap” imports that will (almost certainly) destroy what they have achieved.

    Iraq, just to name one, is a market that will need a lot of cars as it recovers from war.

    And learn something, there’s a LOT of red herrings, lip service and plain old male bovine butt fudge in this. The French are not stupid and somehow they must still have some business going on there.

  • avatar

    Wow. Didn’t see that coming. The Camaro’s seamier side of ownership demographics, (hoodlums, outlaws, brutes, etc.), now goes Global. But, come to think of it though, the front of the car, “the angry Camaro face,” is a face that certainly an Iranian can love. Now the GM Marketing folds can cut out magazine pictures of people in turbans, and glue them to their ‘potential owners diorama lifestyle’ at their desk.

    • 0 avatar
      Athos Nobile

      Camaro is already sold in many LHD markets. Get out of your interwebZ rock and see what Chevrolet sells in other countries.

    • 0 avatar

      Iranians are urban, educated, progressive people that like to drink and f*ck, some who are even gay, suffering under a fundamentalist government supported by rural wack jobs (e.g. the US from 2000 – 2008).

      The only reason Iran is so screwed up is that the US overthrew its democratically elected, progressive government, and threw in a puppet dictator, the shaw ( ), which gave the anti-western fundamentalists the credibility (hey, the US did overthrow a legitimate government and install a puppet dictator) for the 1979 revolution. The reason the US embassy was seized in the 1979 revolution is that the US used the US embassy to orchestrate the 1953 coup.

      It’s not at all surprising Iran wants nukes. Governments interfered with by the imperialistic US, with their governments replaced by puppet dictators: Too many to count. Governments with nuclear weapons interfered with by the imperialist US, with their governments replaced by puppet dictators: Zero.

      Iranians would like a more western, progressive government. I know ethnically Muslim Iranian women whose families came to the US to escape the sanctions. They don’t wear the stupid beekeeper suit, or even a hijab. They drink and party and screw. Iranians are way more progressive, than, for example, the Saudis. Women drive in Iran (and apparently the lucky ones get Camaro convertibles). As much as everyone in Iran hates the US for the coup, people in Tehran still love American culture, liberty and cars – .

      The first step toward toppling the Supreme Leader is trade, open markets have toppled every bad regime ever. And a formal apology for the 1953 coup.

      • 0 avatar
        Don Mynack

        ” suffering under a fundamentalist government supported by rural wack jobs (e.g. the US from 2000 – 2008)”

        C’mon, brah.

        “The only reason Iran is so screwed up is that the US overthrew its democratically elected, progressive government, and threw in a puppet dictator, the shaw, which gave the anti-western fundamentalists the credibility (hey, the US did overthrow a legitimate government and install a puppet dictator) for the 1979 revolution.”

        It was the Shah’s (not the Shaw, LOL) “westernization” program that led to the very backlash you cite. The Shia fundies hated the Ankara-like reforms the U.S.-backed leader introduced – not the other way around. Modern Iran is much more like the Shah’s vision, corrupt, dirty bastard that he was, than Khomeni’s, and that is because in the 70’s they already had much more western culture there. The Shia fundies rolled the Shah’s reforms back, not the other way around.

        Agree with you on the open markets/trade sanctions. Most cost-effective, peaceful way to “westernize”.

        • 0 avatar

          Iran had a modern, western government before the 1953 coup and the Shah, it was the corruption and subversion of Iran’s economic interests to outside countries by the Shah that gave the fundamentalists the coalition for the 1979 revolution.

      • 0 avatar

        I read your comment up until “shaw”

    • 0 avatar

      Wow, overt racism from someone named “Detroit-X”. Way to live down to stereotypes.

  • avatar
    Rod Panhard

    How will GM comply with the recall for windshield visor stickers? Will we have to send in Seal Team 6 with replacement stickers, written in Farsi?

  • avatar

    I think GM proved in WWII that they are traitors when they suppplied Opel trucks tot he German Wehrmacht. (Standard Oil refueled German U-boats in the Carribean when they were on patrol sinking US ships, IBM delivered computers to deal with logistics to terminate millions of people. GM was in good company)

    This whole “american” and patriotic stuff is just advertisement for people who want to beleive a Mexican-made (or made of foreign parts US-assembled) chevy is patriotic compared to a US-built Toyota.

    The only time GM is patriotic is when they need tax money.

    • 0 avatar

      Establishing trade with Iran is patriotic. But that is just a positive externality. GM did it for profit. That’s what corporations are supposed to do, operate in their shareholders best interests. The US did not bail out GM out of sympathy, the US did it because it was in the US best interest to not let a major industry implode because of a credit crisis. Anyway, GM is hardly the only bailout queen linked to Iran:

  • avatar

    The real story here is that the trunks of said Camaros were filled with (very small) F-14 parts.

    • 0 avatar

      They can likely maintain the F-14s with their own industrial capabilities. Anyway, Iran doesn’t need an outdated fighter jet. Thanks to the US overthrow of Saddam the relationship between Iraq and Iran has become increasingly strong, with a significant amount of diplomacy and trade. I hardly expect another war between the countries.

      “Iran has exported $15 billion of goods to Iraq since the fall of Saddam Hussein,” Mehr news agency quoted Kheirollah Khadem as saying.

    • 0 avatar

      I think the Iranians rely more on the F-4.

      • 0 avatar

        the airframe itself is less important if they truly can develop and manufacture stand off weapons. (F-4 ICE, Mig-21-2000, Mirage III’s)

        They’ve reversed engineered the Pheonix and the Hawk missiles systems, and supposedly have had decent combat record with the tomcat

        Russian missiles came from the unexploded Sidewinder,

        Maybe by having camaro’s they can spawn Iranian corvettes? Iranian Malibu’s as cab’s?

        • 0 avatar

          “Iranian Malibu’s as cab’s?”

          Yes, an Iranian take on the Iraqibu!

  • avatar

    The conspiracy theory that this article is assuming, that GM kicked PSA out so that it can have Iran for itself, is pretty far fetched.

    The pressure on PSA came from top level compliance people.

    This export, on the other hand, looks like, to the extent it involved GM at all, it involved GM distributors.

    “The report also states that US Customs and Border Patrol documents list the final destination as the Aras Free Trade and Industrial Zone.”

    The Aras Free Trade and Industrial Zone is a region of Iran, so the cars were correctly declared.

  • avatar

    Excellent article, Derek, by far the best I’ve read on the subject recently.

    I do think the Canadian Camaros now turning up in Iran, and the US administration’s past actions to ensure full sanctions on Iran are only partially connected, and that by happenstance.

    Since GM is partially owned by the US government, the $800 million GM paid for a small percentage of Peugeot was a cheap way to stop almost half a million CKD cars per year being exported to Iran. And everyone at the time and since wondered WTF GM was doing, because it made absolutely no sense commercially. Of course, really stupid reasons were put forth as to synergies, blah, blah, blah. Utter BS. I commented on this before at the time.

    No, GM paid that money as an agent of the US government – – Lt JG Dan Akerman reporting for duty, Sir! So basically $800 million chucked away to ensure sanctions on Iran, affecting GM share price, and hence me directly as a Canadian footing the bill at GM along with US taxpayers. If the US government could deliver a swift kick in the behind to France too just for fun, well hee, hees all around.

    Same mindset as NSA spying on everyone and CIA drone bombing. Puerile and paranoic, and proving Obama kowtows to the bureaucratic interest with no opinion of his own.

    The subsequent apparent softening of Iran’s stances inimical to the US (i.e. commercial interests) now lets GM in the back door, and kicks France to the curb. Same thing as Aramco booting out the French and British oil interests in the Gulf after WW2, and getting Ike to stop the French and Brits from taking over the Suez Canal zone in 1956, while proclaiming the US’s lily white heart. As if. It was just to preserve US hegemony in the region.

    Camaros with Canadian VINs in Iran? Plausible deniability for the future, when it’ll all be our fault and another excuse for the US to never implement WTO judgments won by Canada over the US, the latest of which is the COOL labeling of beef. The US lost, then changed their proposed legislation to make it even more dire, basically thumbing their noses at everyone.

    • 0 avatar

      You live next to the biggest economy in the world. You don’t get to make the rules. No its not fair but it’s life.

      The WTO is useless and only serves to push US/Western interests around the world to the detriment of less fortunate countries.

  • avatar

    Oh Ollie North, you sly devil you. Wait – we’re talking Camaros?

  • avatar

    Whole article is joke, GM exporting few Camaros and this happened… only things for discussion are here that:

    French automakers gave up on Iran – because of pressure , PSA was huge there but GM became investor and suddenly they were gone from Iran, despite years and years of cooperation and Renault now is gone, because they are in alliance with Nissan and Nissan is huge in US.

    But 1 factor that should be said is that Iran really will be big market in future when their regime will have more market oriented economy, so i would be GM, Toyota, VW or one of biggest players in automotive industry already would try to make JV there, yes right now there are sanctions, but they won´t be here forever so i wouldn´t be so surprised if GM would be in contacts to form JV there.

    • 0 avatar

      Toyota sold cars in Iran up until 2010. I’ve been there (my mother is Iranian) and you see a lot of French and some older Japanese cars there. VW also was there at one time, I don’t know if they still are.

      Most Iranians love Americans and American products. Iphones are common over there, even if they’re “illegal” and there are other brands that find their way over there like Nike, Kraft, and many more.

      You can bet that Iran will have another revolution in our lifetimes. The Shah may have been unliked at the time, but nostalgia for those times has been growing and animosity to the dictatorship is growing.

  • avatar

    “an unspecified number of brand new Chevrolet Camaro RS 2LT convertibles were imported by a division of Iranian conglomerate Iran Khodro. According to the report, the Camaros were sent from Miami to Paris, and then from Paris to Tehran via a Qatar Airways plane”

    How large can this “unspecified number” be if they all fit on a single aircraft? And even if they used several aircraft, it just is not financially viable to ship cars by air.

    So, a few “players” in Iran get to drive a Camaro. Maybe it serves them right.

    • 0 avatar

      The appearance of new Camaros in Teheran shouldn’t be a total surprise, The NY Times did a Sunday feature on their automotive page several months ago, showing a number of citizens and their ’70’s Camaro’s and other American muscle cars. There are at least two YouTube videos showing Lamborghini’s, S Class MB, and Bugatti’s cruising in downtown Teheran, undistinguishable from traffic around affluent shopping districts of London. Sometimes, we spend too much time thinking countries like Iran are nothing but rebel fighters, strict religious leaders, and controlling and corrupt leaders. We know so little about some of the rest of the world. I realized this when I checked in with an internet friend from Portugal, and noticed that he sees and knows about more American TV programming and films than I do.

  • avatar

    Submit to sky daddy, or die.
    Submit to the state, or die.

    WTF is the difference?

  • avatar

    Looks like TTAC got the scoop here, top story on drudge today.

  • avatar

    just found this website and i love it. alot of info. thank you Matt.
    im an iranian european citizen and a car lover. i suggest you guys check the ligit porsche/maserati deal with iran. blows your mind. almost 80 percent of porsche panameras produced 2011-2012 where shiped to iran. i count 30 a day with just a quick drive through the city and thats only panameras.
    we iranians love cars and are very good drivers, cause in tehran you dont just have to be careful how you drive but also how the others drive. the chaos law rules ;)

Read all comments

Back to TopLeave a Reply

You must be logged in to post a comment.

Recent Comments

  • FreedMike: I think larger, heavier vehicles are at a disadvantage when it comes to avoiding a crash – they...
  • eng_alvarado90: A-bodies had the THM-125 and it was a 3 spd. It morphed into the 4T40 by the late 80s, early 90s. The...
  • 65corvair: 14 out of 39,000 not too bad. Although are the fleet gets older the rate will increase. How many people...
  • Tstag: Waiting lists for Land Rovers are huge, 18 months for a Defender. I really want one! Would I be prepared to...
  • FreedMike: Speaking of mirroring, how about front end styling that mirrors BMWs back in the day that weren’t an...

New Car Research

Get a Free Dealer Quote

Who We Are

  • Adam Tonge
  • Bozi Tatarevic
  • Corey Lewis
  • Jo Borras
  • Mark Baruth
  • Ronnie Schreiber