Automotive Exports September 2023

Türkiye’s automotive industry growing dynamically
The foundation of Türkiye’s automotive
industry dates back to the early 1960s.
During a period of rapid industrialization
and progress, this key sector transformed
itself from assembly-based partnerships
to a full-fledged industry with design
capability and massive production
capacity. Since 2003, original equipment
manufacturers (OEM) have invested
over USD 17 billion in their operations in
Türkiye. These investments significantly
expanded their manufacturing capabilities,
which in turn led Türkiye to become an
important part of the global value chain
of international OEMs. Meeting and
exceeding international quality and safety
standards, today’s Turkish automotive
industry is highly efficient and competitive
thanks to value-added production.
As part of its commitment to transforming
its automotive industry, which has
historically been a key economic driver
in integrating the Turkish economy with
the global value chain, and to its vision of
making Türkiye an economic powerhouse,
Türkiye has introduced its own locallydeveloped
born-electric car built upon
strength stemming from the country’s longstanding
know-how in the area.
Accordingly, Türkiye’s Automobile Joint
Venture Group, known as Togg, will
produce five different models on a joint
platform with fully-owned intellectual and
industrial property rights by 2030.
Leveraging a competitive and highly-skilled
workforce combined with a dynamic
local market and favorable geographical
location, the vehicle production of 8 global
OEMs in Türkiye has increased by almost
five times from 300,000s in 2002 to over
1.3 million units in 2022. This represents a
compound annual growth rate (CAGR) of
around 6 percent during that period.
• Significant growth posted by Türkiye’s
automotive sector led to the country’s
becoming the 13th largest automotive
manufacturer in the world and 4th largest
in Europe by the end of 2022.
•Türkiye has already become a center of
excellence, particularly with respect to the
production of commercial vehicles. By the
end of 2022, Türkiye was the number one
producer of commercial vehicles (CVs) in
Europe.
• Proven as a production hub of excellence,
the Turkish automotive industry is now
aiming at improving its R&D, design, and
branding capabilities. As of 2022, 156
R&D and design centers belonging to
automotive manufacturers and suppliers
are operational in Türkiye.
• Notable examples of global brands
with product development, design,
and engineering activities in Türkiye
include Ford, Fiat, Daimler, AVL, and
FEV. Ford Otosan’s R&D center is one of
Ford’s three largest global R&D centers,
while Fiat’s R&D center in Bursa is the
Italian company’s only center serving
the European market outside its home
country. Meanwhile, Daimler’s R&D center
in Istanbul complements the German
company’s truck and bus manufacturing
operations in Türkiye. AVL Türkiye, which
opened up its 2nd R&D center in Türkiye,
develops autonomous and hybrid vehicle
technologies.
• Türkiye offers a supportive environment
on the supply chain side. There are around
1,100 component suppliers supporting the
production of OEMs. With the parts going
directly to the production lines of vehicle
manufacturers, the localization rate of
OEMs varies between 50 and 70 percent.
•Türkiye is home to many global suppliers.
There are more than 250 global suppliers
that use Türkiye as a production base, with
30 of them ranking among the 50 largest
global suppliers.
• Auto manufacturers increasingly choose
Türkiye as a production base for their export
sales. This is evidenced by the fact that 73
percent of vehicle production in Türkiye
was destined for international markets in
2022. Türkiye exported more than 950,000
vehicles to international markets in the
same year. In addition, Türkiye has been the
number one vehicle exporter to European
markets for around a decade.
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