MarketReportsOnline com Turkey Autos Report Q2 2012

MarketReportsOnline.com - Turkey Autos Report Q2 2012

Published: June 2012 No. of Pages: 60 Price: US $ 1175




The Turkish Automotive Industry Association (OSD) reported an 8% drop in vehicle manufacturing in
January 2012, when compared to the same month in the previous year. This led to overall vehicle
production of 84,000, while car production was at 47,000. In the same period, 21,077 new passenger cars
were sold in Turkey, a decline of 29% y-o-y. Sales of light commercial vehicles fell 8.4% in comparison to
January 2011 to 8,468 vehicles, Automotive News reports. However, during the same period, the capacity
utilisation rate was at 65% for light vehicles (including cars, pick-ups and minibuses), and 82% for heavy
vehicles. The OSD stated that the Central Bank's policy of a reduction in loan volume has negatively
affected sales velocity, along with fluctuations in the value of the Turkish Lira - which has lost around
20% of its value against the US Dollar since the start of 2011.

Added to this, the head of the Automotive distributors association, Mustafa Bayraktar, when interviewed
by Reuters in January 2012, said that he strongly suspects that there will be a slowdown in the growth of
the Turkish auto market, most likely in the first half of the year. This has been borne out in early figures
through January, mentioned above. While BMI does not see a contraction as likely for all of 2012, we do
see a slower rate of growth, at around 7.1% over the entire year, against sales growth of 16.58% in 2011.
While this may be above the entire economy's growth rate, this must be viewed as a change in spending
patterns. This can be partially pointed towards an increase in government intervention, in an attempt to
slow down a potentially over-heating economy. It is also possible that this policy has partially failed, with
predictions for overall growth of the Turkish economy varying between 4% growth and 2.5% shrinkage.
French automaker Renault intends to spend US$254mn on its production facilities in Turkey in 2012,
compared with US$176mn in 2011, according to the director general of Oyak Renault, Tarik Tunalioglu.
He added that more than US$100mn of the total investment will be directed towards engine production
and transmission elements. The automaker also plans to add light commercial vehicles to its production
line. Oyak Renault, the Turkish production and export subsidiary of Renault, aims to produce the Clio 4
supermini and the refurbished Megane 3 hatchback at its Bursa plant. Oyak Renault also plans to raise its
market share to 20% in all segments from its present 16.4%. BMI expects a diversification of export
destinations, with producers in Turkey set to take more advantage of growth in nearby emerging markets.
Over the long term, we remain upbeat about the prospects for Turkey's auto exports and see them
reaching in excess of 1.25mn units by the end of 2016.
Heavy vehicles have been doing very well in recent years, with an overall 39% growth in the segment
over the course of 2011, according to a Reuters report in January. This brings the total number sold to
45,000 - one of the best years since the financial crisis. One such example of this is Swedish commercial
vehicle manufacturer Volvo Trucks, which increased sales by 31% year-on-year to 1,265 trucks and tow
trucks in 2011, compared with 964 units in 2010, according to Volvo Group Turkey's General Manager
Martin Ericsson. He added that the 2011 sales were the company's highest since its launch in 2001.
Volvo Turkey leads among its regional competitors, including Portugal, Greece, Israel, Ukraine and
Romania.
Q2 2012 Autos Industry Report of Turkey
Table of Contents

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Executive Summary . 5
SWOT Analysis 7
Turkey Autos Industry SWOT . 7
Turkey Political SWOT Analysis 8
Turkey Economic SWOT Analysis .. 9
Turkey Business Environment SWOT Analysis... 9
Global Overview . 10
Eurozone And EMs Pose Risks To 2012 Growth Outlook; US And Japan On The Rise 10
Table: Passenger Car Sales (Units), Jan-December 2011 ... 10
Regional Overview . 14
EU-India FTA: Boon For European Carmakers .. 14
Industry Risk Reward/Ratings .. 17
Poor Show From Western Europe Hurts Region's Score In BMI Ratings 17
Macroeconomic Forecast . 22
TURKEY - ECONOMIC ACTIVITY . 27
Industry Forecast Scenario .. 28
Trade . 32
Competitive Landscape 34
Latest Developments 39
Suppliers .. 45
Company Monitor Toyota Europe: Not Discouraged By The Challenges 47
Company Profiles .. 51
Ford Otosan . 51
Hyundai Assan . 53
Oyak Renault ... 54
Toyota Motor ... 56
Turk Otomobil Fabrikasi . 57
BMI Methodology ... 58
How We Generate Our Forecasting Model .. 58
Sources 59

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