French Car Company In Preliminary Agreement For Iranian JV

PARIS - March 17, 2004; Dow Jones reported that French carmaker Renault SA said Wednesday that it has signed a preliminary agreement with Iranian companies IDRO, Iran Khodro and Saipa for the creation in April 2004 of Renault Pars, a new Iranian joint venture.

Renault Pars will be 51%-owned by Renault and 49% by AID Co, a common entity comprised of IDRO and the two major Iranian car manufacturers, Iran Khodro and Saipa.

Renault Pars, holder of the licence for the X90 vehicle, will be responsible in particular for engineering and quality, purchasing and logistics as well as the coordination of sales policy, marketing and after-sales service.

As of 2006, Iran Khodro and Saipa will begin producing vehicles based on the Renault X90 platform and each manufacturer will have an initial capacity of 150, 000 units.

Vehicle assembly will use both imported parts and local components. Sales of the vehicle will be handled by Iran Khodro and Saipa through specific points of sale in their respective distribution networks.