Iranian car buyers face soaring prices amid war-driven economic crisis

In Tehran, a 32-year-old marketing professional earning about 900 million rials monthly cannot afford a new car, as even basic domestic models now cost tens of billions of rials. Upgrading from his 13-year-old Peugeot 206 to a newer Peugeot 207 would require more than 20 months of his full salary, while a mid-range sedan or crossover would demand 24 to 37 months of earnings. Since the February 28 war and ensuing sanctions, domestic vehicle prices have risen 40-80% and some parts have doubled or tripled in cost.

Parliament member Mohammad Rashidi described the industry as operating like a mafia, citing protected state firms, limited imports and high duties that can double final prices. Production fell sharply, and only a few state-linked firms are permitted to import cars, keeping tariffs and VAT high. A recent car exhibition showcased mostly Chinese models that remain unaffordable for the average Iranian, highlighting the broader cost-of-living crisis.