The domestic market growth in the automotive sector might be limited in the upcoming years, according to the majority of the Turkish automotive sector. The sector predicts the sales of vehicles would be between 1 to 1,2 million units in the domestic market. Ergun Kış, head of KPGM Turkey and partner of the company, said; “The sector officials who marked the taxes should have been reduced for the past three consecutive years, now primarily they prioritize income increase.” Indicating the taxes of the automotive sector still were very high, Kış said, “Despite the tax rates the number of 1 million vehicles was sold in 2015. Now, the players have accepted that the taxes would not drop.” According to the research, the market growth is expected depending on per capita income rise and recovery of the income distribution rather than tax reduction, 55 percent of the sector representatives expected the domestic automotive market would not absolutely grow and would be between the number of 1 – 1,2 million units. Last year, Turkish automobile and commercial vehicle market became 968 thousand units when heavy commercial vehicles included the market reached by 1,01 million units in 2015.
Expectations in capacity met by this year
Kış said the capacity expectations for next 5 years have been met by the beginning of this year due to previous years’ investments entered into force. Following Tofas, Ford Otosan, Mercedes Benz Turk, and lastly Toyota Turkey has also announced that their plant capacity would be raised from 150,000 to 280,000 units through manufacturing a new vehicle model. As for Turkish Automotive Manufacturers Association, the production capacity would raise by 1,9 million with 200,000 units additional increase this year. According to the research, 21% of the sector administrations expected the production capacity would be 1,8 – 1,9 million, 21 percent say it would be 1,9 – 2 million, as for 34 percent the capacity would reach by 2 – 2,1 million units within the next 5 years. Kış recorded, “The prediction of the sector administrators for the next 5 years has been caught as of this year. This shows us this, ‘the investors in Turkey are glad and they are continuing investments.” In terms of the production, 52 percent of the administrators foresee the production would be between 1,3 – 1,5 million, as for 34 percent 1,5 – 1,7 million units in the upcoming 5 years. The Turkish automotive production increased 16 percent to 1,36 million units last year. “Across the world the companies which might invest in the automotive sector are not much. Lastly, Volkswagen’s investment was expected when it preferred Poland, these expectations decreased,” Kış said.