Volvo Trucks has reportedly ceased truck assembly in Iran due to US sanctions which mean it cannot be paid for shipped parts and knocked down kits.

Reuters reported the Volvo move and noted that a number of European companies have been forced to reconsider investments in Iran following US President Donald Trump's decision to reimpose sanctions against Iran.

A Volvo spokesperson told Reuters that the trucks group could no longer get paid for any parts it shipped and had therefore decided not to operate in Iran. The Volvo spokesperson suggested that the bank system in Iran no longer functions properly.

The Reuters report noted that before the sanctions were reimposed, Volvo had expressed an ambition for Iran to become its main export hub for the Gulf region and North Africa markets.

Volvo was working with Saipa Diesel, part of Iran's second-largest automaker SAIPA, which was assembling the Swedish firm's heavy-duty trucks from shipped kits.

The report added that more than 3,500 Volvo trucks had been assembled by Saipa Diesel in the year to May, but none had been assembled after that. Other truck makers are also said to be reassessing business ties to Iran.