Turkey Autos Industry Update Quarter 3 2011

  • July 2014
  • -
  • Business Monitor International
  • -
  • 58 pages

At the beginning of the year BMI made a projection, based on our belief in the underlying strength of consumer demand, stating that Turkish vehicle revenues would grow 16.5% year-on-year (y-o-y) in 2011, to 921,700 units. May’s revenues figures, however, have showed the industry has exceeded even our optimistic predictions. According to figures released by the Automotive Distributors' Association (ODD), vehicle revenues reached record levels. Sales of cars and light vehicles were up 35.52% y-o-y, totalling 339,650 units.
A five-month like-for-like comparison with 2010 showed an even more significant increase of 56.16%. Rises in vehicle revenues were not confined to passenger cars and light vehicles, Mercedes-Benz Türk, the Turkish subsidiary of German automaker Mercedes-Benz reported a rise in revenues of 181% y-o-y in Q111. As a result, we have revised our projections for 2011 and now expect total vehicle revenues for the year of nearly 1.1mn, signalling a complete recovery from the 26% y-o-y production fall in 2009 precipitated by the global financial crisis.
Turkey’s strength in the auto market has been built on robust domestic demand, which has driven investment in the market by major international auto manufacturers. Attracted by government incentives, a low-cost/highly skilled workforce, favourable exchange rate and key positioning in one of the most important emerging industry economies, foreign industry players are pouring investment into the development of Turkey’s auto market . In the first half of the year, Cummins, Michelin, Mercedes and Thyssen Krupp have all made significant investments in the development of production facilities.
Nissan Motor and BMW are also actively considering opening major new plants. BMI believes that international auto manufacturers will increasingly use Turkey as a production base to target export revenues . Figures from Turkey’s Automotive Manufacturers' Association (OSD) reported a rise of auto exports of 20% in 2010, to 754,469 units, to a value of US Dollar 15.9bn. We expect to see a trend of diversification in export destinations with industry players looking to target revenues at nearby emerging industry countries where there is considerably more demand potential for new auto revenues than in developed industries.
Previously, BMI has held a prevailing view that one of the weaknesses of the Turkish automotive market was that it lacked a strong domestic supplier network. However, there are signs that these shortcomings are being addressed. The invitation of up to 10 Turkish parts manufacturers to participate in the development of a highly integrated auto cluster being established in the Russian region of Tartarstan will give Turkish industry players exposure to an international industry . The investment by local industry player Yigit Aku in a new US Dollar 1mn car battery research and development centre and the ambitious targets of the Association of Automotive Parts and Components Manufacturers (TAYSAD) for the establishment of another 50 research centres within two years is another promising development.
BMI believes that many indicators point to a structural shift within the Turkish auto segment that indicate that Turkey is on the verge of a breakthrough in its goal of becoming one of the top auto producers not just in Europe but globally.

Table Of Contents

Executive Summary . 5
Industry SWOT Analysis .... 7
Turkey Auto Industry Environment and Risk Analysis .. 7
Turkey Political Environment and Risk Analysis 8
Turkey Economic Environment and Risk Analysis ... 9
Turkey Business Environment SWOT .... 9
World Overview 10
BMI's Core Views For The Automotives Market ... 10
Regional Overview . 15
EU Visualises An Oil-Free Future, But Will The Market Accept It? .... 15
Data : EU Action Plan For Electric Vehicles .... 17
Data : Europe - Top Automotive Suppliers Sales By Region (US$mn) 2010 ... 18

Environment Overview Ratings . 19
Data : BMI Market Risk-Reward Ratings For Autos In Europe . 23

Market Projection Scenario ... 24
Data : Turkey Auto Production - Historical Data And Projections .... 24
Trade 29
Data : Turkey Auto Trade - Historical Data And Projections .. 29
Macroeconomic Projection . 31
Turkey - Economic Activity . 33

Competition Overview ... 34
Latest Developments .. 37
Government Policy .... 42
Suppliers 44
Company Monitor ... 46
MAN.. 46
MAN: SWOT .... 49
Company Profiles ... 50
Ford Otosan 50
Hyundai Assan . 51
Oyak Renault ... 52
Toyota Motor ... 53
Türk Otomobil Fabrikasi 54
Country Snapshot: Turkey Demographic Data . 55

Section I : Population . 55
Data : Demographic Indicators, 2005-2030 . 55
Data : Rural/Urban Breakdown, 2005-2030 56

Section II : Education And Healthcare . 56
Data : Education, from 2002 to 2005 ... 56
Data : Vital Statistics, 2005-2030 .. 56

Section III : Labour Industry And Spending Power 57
Data : Employment Indicators, from 2001 to 2006 ... 57
Data : Consumer Expenditure, from 2000 to 2012 (US$) ... 57
BMI Methodology ... 58
How We Generate Our Projection ing Model ... 58
Sources .. 59

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