Fiat Ban On Sales To Iran Seen As Victory In Sanctions Campaign
26 May 2012 - 7:12AM
Dow Jones News
Supporters of trade sanctions against Iran said Friday that
Italian auto maker Fiat SpA's (F.MI) decision to stop doing
business in Iran represented a major victory in a campaign to align
European companies against Iran's nuclear program and human-rights
violations.
Fiat and its sister companies, Fiat Industrial and CNH Global
N.V. (CNH), said they will cease business activities in Iran in
support of diplomatic efforts to convince the leaders of Iran to
abandon its nuclear program, which is widely suspected of
developing nuclear weapons. Iran has denied that it is making
nuclear weapons.
"Fiat announces that effective immediately its subsidiaries will
no longer carry out business activity related to products or
components where the ultimate destination of such products is known
to be Iran, other than to the limited extent required to fulfill
already existing binding obligations," said Fiat, which also owns
U.S. auto maker Chrysler Group LLC.
Fiat Industrial and CNH issued statements with the same wording.
Fiat exports cars to Iran while Fiat Industrial exports buses and
trucks under its Iveco brand. CNH Global builds farm and
construction machinery that is sold in Iran.
United Against Nuclear Iran, a New York-based lobbying group,
said Fiat's decision is a milestone in its campaign to convince
multinational corporations to stop selling products 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," the group said in a written
statement.
United Against Nuclear Iran also has been waging a "Cranes
Campaign" against companies whose machinery in Iran is used in
executions where the condemned are hung from cranes and their
bodies left to dangle for public display. The group has used
public-pressure tactics against several U.S. companies in recent
years that it viewed as skirting a U.S. prohibition against
domestic companies selling directly to Iranian customers.
Caterpillar Inc. (CAT), Ingersoll-Rand PLC (IR), General
Electric Co. (GE), Terex Corp. (TEX) and Huntsman Corp. (HUN) are
among the U.S. companies that have moved to cut off overseas
subsidiaries and independent dealers with sales ties to Iranian
customers.
The group said European and Asian companies have started to
follow suit after largely resisting pressure from the group in the
past.
"Things are really changing and a lot of it has to do with the
European Union getting more serious" about Iran's nuclear program,
said Nathan Carleton, a spokesman for United Against Nuclear Iran.
"It's a different climate than it was a year ago."
Carleton said Fiat joins rival auto makers Porsche Automobil
Holding SE (PAH3.XE) in Germany and South Korea's Hyundai Motor Co.
(005380.SE) in recently disclosing that they will cease sales to
Iran.
Carleton said the group intends to remain vigilant about
monitoring Fiat's business activities in Iran, noting that other
companies have used existing contracts with dealers and
distributors to maintain a presence in Iran long after announcing
an end to direct sales activities.
"We're going to keep an eye on it," he said.
The U.S. has said Iran must take significant steps toward
addressing concerns that it wants to build nuclear weapons before
economic sanctions are lifted. The latest talks to reach an
agreement were held in Iraq this week.
-By Bob Tita, Dow Jones Newswires; 312-750-4129;
robert.tita@dowjones.com
--Gilles Castonguay contributed to this article.
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