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French carmaker Renault in Iran accused of a huge write off the value of its first-half operating profit declined sharply.
Clio and Megane hatchback manufacturer said Friday that it took ? 5,120,000 ($ 6,800,000) Expenditures Iranian businesses to write off the full value of which is determined by the threat of international sanctions, the Islamic Republic.
With other costs, including the transformation of the factory in France, leaving Renault first-half profit of only 3.9 billion euros, from 734 million euros a year earlier, car manufacturers, said in a statement Friday.
New car sales continued to fall, international growth can not offset the poor in the European market, especially in France. Renault said that the deterioration in market conditions, will be put into doubt its full-year targets, including higher global registration.
Renault business in Iran by the assembly of the vehicle packet sent there. U.S. tougher sanctions against the Islamic regime into effect last month, it means that Renault can not get money out of Iran, leading to its second-quarter earnings of complaint.
Earlier this month, the European Automobile Manufacturers Association ACEA said car sales in the first half of this year fell 6.6 percent, because there are indications that a severe recession in Europe and high unemployment continue.
In response to the shrinking European market, car manufacturers have announced plant closings and delayed introduction of a new car.