Turkey is a strategic market for automobile manufacturers in the region due to its growing domestic market, membership in the EU Customs Union, and the potential for access to regional markets from Turkey in Europe, Central Asia, and the Middle East. Many international vehicle producers already have production in Turkey. Presently, 19 international vehicle producers including Ford, Toyota, Renault, Fiat, Chrysler, Opel, Honda, Hyundai, Peugeot, MAN, Mercedes, Isuzu, Mitsubishi, have joint ventures (JV) partnerships with local firms, direct investment, or license agreements.
• Turkish automotive production capacity has reached 1.2 million units, and is targeting 2 million units in 2015.
• Among EU customs union countries, Turkey is the
- Largest bus producer
- Third largest Light Commercial Vehicles (LCV) producer
- Third largest truck market
- 17th largest automotive producer on the world.
The Turkish automotive parts and service equipment industry has expanded as Turkish automotive production and imports have increased. 2004 was a record year for the industry in production, exports, and sales. Exports continued on the same trend in 2005, but the domestic market stagnated. In 2007, auto parts exports increased by 40%compared to the year before. Today, the Turkish automotive and parts industry has an integrated part of the global automotive and parts industry. The Turkish auto parts industry manufactures parts for vehicle manufacturers in the Turkish market and produces aftermarket parts in all markets. Turkey’s high production capacity, high standards, and large product manufacturing variety now rank first in total exports ahead of traditional exports such as textiles and apparel. Ninety percent of locally produced parts are used either in the production of vehicle exports or for the world automotive parts market.
However, the Turkish export-based auto industry was hit hard by the global crisis. While local vehicle manufacturers benefitted from tax reductions in the local market to increase sales, auto parts manufacturers were not as fortunate. The effects of the global crisis will be clearer with 2009 statistics, but a 15% year on year decrease in the local market is expected. A decrease of more than 30% in exports is also estimated for 2009.
Best prospects for OEM and After-market sales are: shock absorbers, brakes and clutches, piston rings, oil filters, bumpers, lights, signaling parts, glassware, additives, spark plugs, tires, lights and catalytic converters.
The statistics included in this report cover products of more than 200 different Harmonized Tariff Numbers.
The automotive parts and services sector has developed with the expansion of Turkish automotive production and the sales of imported vehicles. The sector includes automotive parts and accessories for new vehicles and used vehicles estimated at 10 million units. In 2009, the demand for automotive parts and accessories was estimated to be $11 billion, over 80% of which is expected to be imported. Manufacturers have begun to expand capacity, modernize facilities, improve production and product quality, and initiate new model developments due to increased local demand and competition in Turkey. In addition to local production, many automobile brands are imported into Turkey. In the first eight months of 2009, 194,713 units were imported.
In Turkey, automobile maintenance and service life times are long, which improves the market for automotive aftermarket suppliers. Tax incentives for used car purchases and low cost labor help sustain a large used car market. Nearly 44% of automobile parts total sales in Turkey are made in the automobile aftermarket and to the Original Equipment Manufacturer (OEM) industry. The rest is exported.
By Berrin Erturk