Europe

PSA group reaches deal to make 200,000 cars a year in Iran

Associated Press
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The managing director of Iranian car maker, Iran Khodro, Hashem Yekke Zare, left, and the chairman of the managing board at the French carmaker Peugeot Citroen PSA Carlos Tavares shake hands after a press conference in Tehran, Iran, Wednesday, Oct. 5, 2016. Peugeot Citroen PSA has reached a deal with Iran's biggest carmaker to open a plant producing 200,000 vehicles a year, renewing an old partnership with Iran Khodro Co following the lifting of international sanctions. The two companies showcased five models to be produced by IKAP, a joint venture first announced in January during a visit to France by Iranian President Hassan Rouhani. (AP Photo/Ebrahim Noroozi) (The Associated Press)

Workers inspect a Peugeot 508 at the Iran Khodro car factory in Tehran, Iran, Wednesday, Oct. 5, 2016. Peugeot Citroen PSA has reached a deal with Iran's biggest carmaker to open a plant producing 200,000 vehicles a year, renewing an old partnership with Iran Khodro Co following the lifting of international sanctions. The two companies showcased five models to be produced by IKAP, a joint venture first announced in January during a visit to France by Iranian President Hassan Rouhani. (AP Photo/Ebrahim Noroozi) (The Associated Press)

Iranian car workers inspect a Peugeot 508 at Iran Khodro car factory plant in Tehran, Iran, Wednesday, Oct. 5, 2016. Peugeot Citroen PSA has reached a deal with Iran's biggest carmaker to open a plant producing 200,000 vehicles a year, renewing an old partnership with Iran Khodro Co following the lifting of international sanctions. The two companies showcased five models to be produced by IKAP, a joint venture first announced in January during a visit to France by Iranian President Hassan Rouhani. (AP Photo/Ebrahim Noroozi) (The Associated Press)

French carmaker PSA Peugeot Citroen has reached a deal with Iran's biggest carmaker to open a plant producing 200,000 vehicles a year, renewing an old partnership with Iran Khodro Co following the lifting of international sanctions.

The two companies showcased five models on Wednesday to be produced by IKAP, a joint venture first announced in January during a visit to France by Iranian President Hassan Rouhani.

Peugeot was a major player in Iran's car market before sanctions were imposed. PSA group says negotiations for the deal began before the sanctions were lifted.

During the Paris auto show last week, French carmaker Renault announced it had reached a deal to make at least 150,000 vehicles a year with the Industrial Development and Renovation Organization of Iran.