The U.S. Department of the Treasury announced on October 1, 2026, that it has targeted seven companies active in Iran's automotive industry as part of a new round of sanctions known as "Operation Economic Outcast." These sanctions are particularly focused on Iran Khodro and Saipa as the two main players in Iran's car market.
Sanctioned Companies
According to a notice from the Office of Foreign Assets Control (OFAC) of the U.S. Department of the Treasury, the following companies have been placed on the sanctions list due to their activities in Iran's automotive sector:
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- Iran Khodro
- Saipa
- Iran Khodro Diesel
- Pars Khodro
- Zamyad
- Shiraz Motor Power
- Damaavand Motor Power
Iran Khodro and Saipa are recognized as the largest car manufacturers in Iran, particularly in the passenger car sector, and together they hold a significant share of the domestic car market. Iran Khodro Diesel is also listed as a manufacturer of heavy vehicles and buses.
Dimensions of the Sanctions
In addition to the sanctions imposed on the major car manufacturers, the names of two companies, "Shiraz Motor Power" and "Damaavand Motor Power," are also mentioned in the U.S. Department of the Treasury's announcement. These two companies are recognized as key players in Iran's motorcycle industry and have been subjected to the new sanctions.
Some reports have also mentioned Hepco in the list of "eight sanctioned car manufacturing companies." However, the official announcement from the U.S. Department of the Treasury does not explicitly list Hepco among the seven specified companies in the automotive sector. Therefore, the number of companies specifically named in the Automotive Sector is limited to seven.
The scope of the new U.S. sanctions is not limited to the automotive industry, as the Department of the Treasury has simultaneously targeted several entities active in Iran's railway industry. The names of the Islamic Republic of Iran Railways, Raja Passenger Trains Company, and Rail Transport Company are included in these sanctions.
These sanctions also encompass foreign companies related to the supply chain of Iran's automotive industry. The U.S. Department of the Treasury has announced that companies in Indonesia, the UAE, Turkey, and Hong Kong that have played a role in supplying or shipping car parts for Iranian companies have also been sanctioned. This indicates that the scope of the sanctions is not solely directed at Iranian companies but also includes part of the supply chain and foreign trade related to Iran's automotive industry.
The new U.S. sanctions are based on Executive Orders 13902 and 13871 and are related to Iran's industrial sectors. According to the rules announced by OFAC, the assets and financial interests of sanctioned individuals and companies that fall within U.S. jurisdiction will be blocked, and U.S. persons are generally prohibited from engaging in transactions related to them unless there is a license or legal exception.
Overall, the new U.S. sanctions target a significant portion of Iran's automotive industry supply chain and, by including the names of major companies like Iran Khodro and Saipa, will have profound economic consequences.
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