Leading Iranian vehicle manufacturer Iran Khodro Company (IKCO) and PSA Peugeot accomplished one-fifth of a 2016 deal by so far investing €100 million ($106.9 million) in a joint company in Iran, said an official.

Each of the two companies has invested €50 million ($53.4 million) in the factory whose first product, Peugeot 2008 will be out by March, Hashem Yekke Zare, CEO of IKCO, was quoted as saying in an Iran Daily News report, citing Fars News Agency.

The two companies from Iran and France signed a contract on June 21, 2016, to launch a joint company in Iran to produce Peugeot cars, it said.

Zare further noted that Iran's share of the parts that will be used will initially be 40 per cent and increase to 70 or 80 per cent in two years.

He added that the company will start production with Peugeot 2008 and then move on to models 301 and 208.