T he automotive industry is the locomotive of the industrialized countries and usually placed amidst a network of sub-industries and related fields. Countries that develop a strong automotive industry enjoy the huge contributions of this sector to the economy in overall, however, as the leading industry that closely affects other industries faces increasing competition, fluctuations in global markets and big mergers between global giants, number of manufacturing automotive companies decrease steadily. On a global scale, around 20 companies constitute 90% of the whole automotive industry. Automotive industry is the main component of German and Fre nch economies. Since 1960s, Japan has also been focusing on this industry and enjoyed huge automotive exports and a big leap in overall exports as a result of this diligence.
At first glance, European countries, followed by USA, has been the leader of the industry till 2002, in terms of total vehicle production. However, since 2003, Asian countries took over the leading position. Except the slight decrease in 2001 by 3.6%, overall vehicle production volume in the globe has steadily increased. For example, in 2005, the production increased by 3.1%, reaching total 66.5 million pieces, of which the biggest contribution belongs to the Asian countries.
In terms of manufacturer companies, General Motors, Toyota, Ford, Volkswagen Group and Daimler Chrysler constitute the top five producers. Of 66.5 million pieces produced in 2005, these five produced 33 million, which is nearly the half of total production in the globe. Automobiles and light commercial vehicles constitute the most of the overall vehicles produced by these five global giants.
As to Turkish automotive industry, it's economic importance is crucial for the country's economy considering the value added it creates, contribution to overall employment figures, tax incomes, demand creation in various sub and related sectors and contributing to the technological development especially in the last years thanks to the development of domestic automobile project. Besides, the industry plays a key role in transferring the know-how and high-tech to the country. Beginning to develop in 1950s, the industry's development accelerated in mid 60s; initially by establishment of an assembly line to produce all-terrain vehicles and trucks for the military, and eventually the industry saw serial production of commercial buses, automobiles and trucks. Domestic designs began to be produced by 1966 and Otosan created the famous Anadol model, followed by establishment of TOFAŞ and Oyak-Renault, under Italian and French licenses, starting their production.
While automobiles retained their status as most produced vehicles in the industry, in year 1999, semi-trucks took the second place from tractors. In the meantime, giants from Far East, Mitsubishi, Toyota, Honda and Hyundai entered Turkish market via huge investments and opening of production or assembly facilities, further increasing the depth of the industry.
Since 2002, Turkish automotive industry enjoyed an accelerated increase in production, especially in 2003 and 2004. 357.217 pieces produced in 2002 increased to 562.466 in 2003 and to 862.035 in 2004. This was mainly due to the fact that Turkey was becoming a base for automotive giants to produce and export to the rest of the world thanks to the advantages the country offers. In year 2015, overall production increased by 16%, automobile production increased by 8% compared to the previous year, making a total production of 1.35 million pieces, of which 791.000 are automobiles. In year 2015, total market volume reached 1.1 million, increasing by 25%, whereas automobile market expands by 24%, reaching 726.000. In terms of exports, total automotive export volume increased by 12% in quantitative terms, making 992.000 in total; automobile exports increasing by 4% and reaching a total number of 605.000.
In the current year, January – April period proves a favorable season as figures say the total production increased by 3% and automobile production increased by 6%. In this period, 469.000 pieces are produced, of which 283.000 pieces are automobiles. However, overall market shrank slightly, by 7%, and realized as 260.000. In terms of exports, compared to the same period in the previous year, overall automotive exports increased by 7% and automobile exports by %2, in quantitative terms; total 359.000 pieces are exported, of which 215.000 are automobiles.
The strong capital structure in Turkish automotive industry, foreign-Turkish joint ventures, strong sub and related industries, qualified work force, advantages of the geographical position, standardization of the quality system are the main competitive strengths of the sector. As it already proved itself to be a prominent industry on global scale, the industry should keep investing and focusing on sustainability, efficiency and export-oriented policies; seize the latest trends and technologies, maintain the cooperation between the main and sub&related industries; increase the incentives and investments in order to become one of the top. As the industry has a multiplier effect on other industries, it has a key role in 2023 export goals of Turkey, one of the crucial components of Turkish economy in terms of employment, tax incomes and R&D. Thanks to its strategic geographical position, Turkey is likely to attract more foreign investment and increase its efficiency as a production base for world giants, as well as developing its own technology to have its domestic brands to sell with greater value added.Published on Thursday, June 9, 2016