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Turkish Automobile Industry
Submitted by lale duruiz, İstanbul Bilgi University İstanbul Bilgi University on 2 févr. 2011 - 17:20
Type de publication:Conference Paper
Source:Gerpisa colloquium, Paris (2011)
The paper will analyze Turkish automobile industry; industrial development, investments and the structure, market and foreign trade trends, production and clustering, competitiveness in the global markets and sustainability. It will also look at the impact of financial crises, and government policies related. The challenges the industry facing will be discussed after the detailed analysis.
Turkish automotive sector has been one of the most strategically important sectors of the economy. It has attracted foreign direct investments; contribution to employment has been significant; in the last years, the export ratio has increased climbing up to the first place among the sectors increasing its global competition. The industry, with 511000 car production of which 72 % exported, has proved to be an active sector even under the condition of global financial crisis.
Turkey has been seen as an emerging market for car industry in the recent years, the foreign firms use aggressive market strategies with lower prices in order to enter and increase their market share. In 2009, special consumption tax (STC) on automobiles helped to offset the negative impact of the global credit crises. Turkish market is seen as growing potential as a result of increasing incomes and high value of car ownership and travelling by car being preferred in the country. The import market is volatile affected by the currency, occupies 66 percent of the total passenger car market.
The automobile manufacturers in Turkey are mainly joint venture firms with the known global assembler firms. These companies were oriented towards the domestic market until the early 1990s, but globalization came with the customs union agreement with EU. New foreign companies entering the Turkish market in the second half of 1990s have targeted the EU market as well. These companies have strong links with their subsidiaries in the EU, and intra-firm trade has apparently played an important role in producing automobiles in Turkey and marketing them in the EU countries. Although Turkey does not have national car brand, it has a leading position both in Europe and world market especially in commercial vehicles.
Despite progress over the last fifteen years, Turkey has not achieved a satisfactory level of environmental protection. It will only be possible to adopt the requirements in the long term and this will entail large-scale investment. (EU 2009 reports)
Although the automobile industry is well integrated within international, or more specifically, European production chains, the automobile parts and components sector has developed slowly and attracted foreign investment in the 1990s. Strong and responsive supplier-producers links have enabled automobile producers to expand their capacity and output rapidly after the 2001 crisis. The manufacturers have benefited to a large extent from the existence of a strong domestic industrial and supplier base, which consists of small and medium sized firms with less than 50 employees.
Component supply industry in Turkey is able to manufacture approximately 80 % of the entire component demand ranging from engines to rubber parts. In recent years, the component supply industry gained a competitive position and expanded its customer portfolio also in internal markets.
The automotive industry in Turkey is concentrated in the most developed areas of the country. The assembly plants and their suppliers are mostly located on the peripheries of largest metropolises. Clustering in Turkey is important in order to be able to compete in the global markets where companies have to face with the continuous innovation, joint research, product design, marketing, procurement, training and other collaborative activities which pin down firms within clusters to compete successfully in global markets, which arise a) due to integration into EU and b) as a necessity of the globally changing economic atmosphere of the world.
For example, The Marmara Region is endowed with favorable factor conditions, which have made the Cluster an attractive place for manufacturing for the global players of the automotive industry. The Cluster is geographically proximate to the European markets and the largest consumer markets in Turkey. Large supply of skilled labor force and variety of high quality services and the existence of the first-tier suppliers are the other factors.