Bowing to Pressure, Fiat Suspends Business in Iran

In a terse statement issued in Turin today, Fiat said that effective immediately its subsidiaries would no longer carry out business activity related to products or components where the ultimate destination of such products is known to be Iran. The only caveat was requirements to fulfill already existing binding obligations.

The Italian company, which controls Chrysler, was quick to say that Sales to Iran based entities during past years by Fiat’s subsidiaries were “totally immaterial in a quantitative and qualitative sense” and any concerned products were sold for commercial and civilian use only.

The U.S. government is attempting to stop the continuing development of nuclear weapons in Iran, an effort that has so far failed in spite of boycotts and an impending ban on oil imports from Iran to the European Union.

“We applaud Fiat’s decision to end certain parts of its business in Iran. We welcome this announcement, and are pleased that Fiat’s subsidiary Iveco will no longer sell trucks to the Iranian regime, which has used them to transport ballistic missiles and perform gruesome public executions,” said Mark D. Wallace, the head of the pressure group United Against Nuclear Iran – UANI. Wallace holds the opinion that responsible international auto companies will not continue to work in Iran.

UANI then called on Fiat to end fully all of its business in Iran, including the sale and manufacturing of all Fiat and Maserati vehicles. In April news reports said a Maserati showroom would open in Tehran.

“Fiat should confirm that it is not, directly or indirectly, engaged in any business in Iran, providing any goods or services in Iran, or implementing any agreements with Iranian entities including the Pars Industrial Foundation,” UANI said in a statement.

The auto industry represents 20% of Iran’s GDP that is dominated by the Islamic Revolutionary Guard Corps. UANI has developed model legislation, The DRIVE Act, to force auto manufacturers to choose between American taxpayers and the regime. The DRIVE Act requires automakers to certify they are not engaged in any business in Iran, or engaged in the implementation of any agreement with Iranian entities in order to be eligible for U.S. government contracts or financial assistance.

In the view of some, this is a perfect example of the hypocritically bad behavior of global corporations supporting terrorism and repression abroad in the pursuit of profits against the policies of their home governments, whose democratic laws protect them and provide for the well being their stockholders and executives.

Wallace was part of the George W. Bush Administration from 1999 to 2003 in a variety of federal government general counsel positions. Wallace was part of the legal team that successfully argued in front of the Supreme Court that the hanging chads fiasco in Florida was valid, a decision that remains controversial or laughable in the view of many.

Last week, Wallace testified about Iran’s auto industry before the U.S. House Foreign Affairs Committee. Wallace called out Peugeot and its U.S. collaborator GM claiming, “Peugeot right now is a major actor in Iran, a major manufacturer inside Iran in direct partnership with the IRGC. In fact, while Peugeot says it suspended its business with Iran until July, Iran produced more than 15,000 Peugeot vehicles in April.”

Numerous queries to Peugeot by AutoInformed have gone unanswered. In its latest holding statement GM said, “We have discussed this issue with Peugeot. We understand that they made the decision to suspend the production and shipment of material into Iran some time ago — before we entered into our alliance with them in fact — and have decided to continue with that suspension. Our agreement with them is fully compliant with U.S. law governing trade with Iran, and is not intended to benefit Iran in any way.”

Wallace also said that when it comes to Nissan, which was recently awarded New York City’s $1 billion “Taxi of Tomorrow” contract, Americans “should be able to use the power of New York’s pocketbook to impress upon Nissan to stop manufacturing automobiles in Iran.”

See: Iran Auto Production Down 27% as UANI Blasts Peugeot and Nissan for Ongoing Business with Islamic Revolutionary Guard

About Ken Zino

Ken Zino is an auto industry veteran with global experience in print and electronic media. He has auto testing, marketing, public relations and communications expertise garnered while working in Asia, Europe and the U.S.
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