Turkish auto industry at full throttle despite the slowdown in Europe

Hürriyet - Türkiye’s automotive industry is showing no signs of slowdown amid the stagnation that is taking hold of the European car industry. New investments, facility upgrades, and model additions are taking place in global car makers’ Turkish facilities, while 58 of Europe’s top 100 car plants are facing serious losses in one of the worst years for the industry in decades.

Boosted by the country’s new incentive scheme, car makers with manufacturing operations in Türkiye are pressing ahead with their investment plans totaling TRY 5 billion to be realized throughout 2013.

Ford Otosan, the Turkish subsidiary of Ford Motors, will be adding 4 new models to its product line in Türkiye. Investing USD 1 billion in the process, the JV between Türkiye’s Koc Group and Ford Motor Company is already manufacturing Tourneo Custom and Transit Custom, two passenger vans for the global market. The company plans to start production of the new Transit model light commercial vehicle (LCV) in August and will introduce yet another LCV , the Transit Courier, sometime next year. The Transit Courier will be manufactured in an all-new plant which is under construction in Türkiye’s Kocaeli province. The company’s heavy truck unit that has been in operation in Türkiye since 1960 relies on local manufacturing and engineering talent for the Cargo truck and Ecotorq engines, currently exported to over 60 countries.

The South Korean car maker Hyundai, presently manufacturing the i20 hatchback in Türkiye, will soon add the next generation of i10 to its production line, which also competes in the same segment. The brand intends to solely focus on the production of superminis at its Turkish plant in Kocaeli, an important hub for Türkiye’s automotive industry cluster. The TRY 1.1 billion facility upgrades will increase the plant’s capacity to 200,000 vehicles per year, with the first i10 rolling out in September.

Another Far-Eastern car maker, Toyota of Japan, is set to begin manufacturing the new Corolla in its Turkish plant this month. Having invested EUR 150 million in its Adapazari, Sakarya plant, Toyota Türkiye will mainly supply the company’s European markets with the new Corolla and revamped Verso at a rate of 180,000 vehicles a year.

Unfazed by the falling sales in their home countries, two European manufacturers, Italian Fiat and French Renault, are expected to invest a total of TRY 800 million in their plants in Türkiye. Turkish-Italian JV Tofas, is reportedly considering adding a sedan type vehicle to its production line next to the popular Doblo LCVs. Meanwhile, Oyak-Renault has plans to replace the Fluence with a new B-segment sedan by 2015 and is now waiting for the final approval from its headquarters in France.

Over 1 million motor vehicles were produced in Türkiye in 2012 according to the Turkish Automotive Manufacturers Association. The auto industry is a key driver for Türkiye’s increasingly export-oriented economy with 730,000 vehicles shipped abroad last year, generating an income of nearly USD 20 billion.

Image of Hyundai Automobile Factory