The world’s number one carmaker by sales, the Renault Nissan Mitubishi Alliance, will not leave Iran even if Washington re-imposes substantial sanctions against Tehran, the Associated Press reported on October 6.

Renault has seen a resurgence in sales in the Islamic Republic since relaunching in 2016. There was an 82.6% jump in sales of its imported and assembled vehicles on the market across the first six months of the Persian calendar year (started March 21).

"Obviously if it becomes impossible to deal with Iran we will put a plan together for the suspension of our business there, but that's not at all to say that we will leave Iran,” Renault CEO Carlos Ghosn Ghosn told reporters.

Stating that Iran's market has growth potential, he referred to the ongoing tensions between Tehran and Washington over the future of the nuclear deal, adding: "If we can't work there immediately, then we will work there in one year, two years, three years because I don't think that this is a situation that can last for ever."

In early August, Renault signed a long-anticipated joint-venture deal with Iran's state-run Industrial Development and Renovation Organisation (IDRO) and Iranian private company Parto Negin Naseh Group (Negin Khodro) worth €660mn.

It represented yet another move by a big French company to spearhead the rebuilding of trade and investment ties with Iran in the post-nuclear sanctions era, with French energy major Total having in early July decided to plough an initial billion dollars into developing Iran's South Pars gas field phase 11. Despite intense pressure from the Trump administration to isolate Iran, it seems that France, Germany - early July also saw Volkswagen return to Iran after 17 years - and several other EU member states, along with Russia, China and Japan, are quite happy to pursue growing commercial relations with the Iranians, while seeking to protect the nuclear deal.

More than 60 Iranian automotive component companies will work to supply the new Renault-led JV.

A renovated plant is to produce the Dacia Duster (rebadged as a Renault), Renault Symbol and Renault Kwid, originally designated for the Indian right-hand drive market, creating around 3,000 jobs. It is expected that cars rolling off the production lines, located in Saveh, slightly over 100km southwest of Tehran, will annually add 150,000 vehicles to the Iranian market. Renault currently has the capacity to produce 200,000 vehicles a year in Iran.

Renault also announced in August that it would restart sales of its recently relaunched Datsun brand in Iran, again in conjunction with Iran Khodro Company.

It is estimated that Iran will produce more than 1.4mn vehicles this year as part of the country’s push to upgrade its ageing car stock. Some estimates put the average age of vehicles in the country at 10-years-old, whereas in Europe the figure is around 6-years-old.