An influential US anti-Iran lobby group on Wednesday called for newly tied General Motors and Peugeot to shut down Peugeot's Iran business due to Tehran's suspect nuclear program.
The United Against Nuclear Iran group said GM's new investment in PSA Peugeot Citroen should be investigated to see if it violates US sanctions on Iran, because of Peugeot's strong market position in the country.
"As a working partner and now official stake-owner of Peugeot, GM owes it to its investors and customers to compel Peugeot into ending its business in Iran," said UANI head Mark Wallace, a former US ambassador to the United Nations.
"By doing business directly with the Iranian regime, Peugeot supports the regime's ability to develop its illegal nuclear weapons program, support terrorist proxies and repress the Iranian people."
He called for a congressional investigation of the auto deal.
But GM and Peugeot both said Peugeot had already halted its shipments to Iran of car components used for assembling final vehicles.
"The decision to halt shipments was taken during February for the month of March and renewed for April," Pierre-Olivier Salmon, spokesman for PSA, told AFP.
"It is a decision taken month by month," he added.
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GM spokesman Greg Martin told AFP that Peugeot decided to suspend production and shipment of material into Iran "before we entered into our alliance with them, in fact."
"Our agreement with them is fully compliant with US law governing trade with Iran, and is not intended to benefit Iran in any way," he said.
On Tuesday, the two automakers announced that GM had acquired a 7.0 percent shareholding in PSA, Europe's number two carmaker, as both sought to rationalize market and production operations.
UANI called Peugeot the leading foreign auto supplier in Tehran, and said its main local partner, the Iran Khodro Group or IKCO, "is controlled by the Iranian regime, and affiliated with Iran's Islamic Revolutionary Guard Corps."
The Revolutionary Guards especially have been targeted under US sanctions set by the White House and US Treasury, which forbid any US firm or person from doing business with them.
Wallace noted that the Treasury itself owns 32 percent of GM after the 2008 rescue of the top US automaker.
"It is unacceptable for GM to financially align itself with a company that so openly deals with a regime that is responsible for the deaths of US servicemen and threatens US and global security," Wallace said.
"The GM and Peugeot partnership may also run afoul of US sanctions, and should be investigated by Congress."
While an unofficial, non-profit organization, UANI boasts strong links to official Washington. Besides Wallace, its co-founders and advisory board include former top US diplomat Dennis Ross, ex-CIA chief James Woolsey and former White House homeland security adviser Frances Townsend.
The Treasury did not immediately respond to a request for comment.