11.06.2024 12:32
The market share of Chinese brands in the automobile and light commercial vehicle market in Turkey increased to 8.13% in the first 5 months of the year. The Ministry of Trade aims to support domestic production and encourage investments through the implementation of additional customs duties. Chinese brands such as Chery, MG, DFSK, and Maxus are among the companies in Turkey. While the position of Chinese brands in the Turkish market is strengthening, the Turkish automotive sector is expecting investments from Chinese brands.
The share of Chinese brands in the total automotive market in Turkey, including cars and light commercial vehicles, was 8.13% in the first 5 months of the year. The Presidential Decree on Amendment to the Decision on Additional Customs Duty Application for Imports was published in the Official Gazette.
Accordingly, the Ministry of Trade had decided to apply additional customs duties to Chinese gasoline and hybrid passenger cars imported into the domestic market at 40% of the import value or the higher of 7,000 dollars per unit, in order to increase and protect the share of domestic production in the domestic market and to encourage investments in the domestic market.
Following the decision, the market share and investment status of Chinese automotive brands in Turkey came to the agenda. Chinese brands, which are strengthening their position in terms of both quantity and market share in the Turkish automotive market day by day, have maintained their "silence" in terms of investment.
THE ROLE OF CHINA IN TURKEY'S FOREIGN TRADE DEFICIT
Experts point out that China plays an important role in Turkey's foreign trade deficit and that the automotive sector is one of the most important sectors in this deficit.
According to the data compiled by AA from the Automotive Distributors and Mobility Association (ODMD), car and light commercial vehicle sales increased by 6% in the first five months of the year. Thus, a total of 471,743 new vehicles were sold by the end of May.
While car sales increased by 10.25% to 375,097 units during this period, light commercial vehicle sales decreased by 7.9% to 96,646 units.
THE NUMBER OF CHINESE BRANDS IN THE ODMD LIST WILL INCREASE TO 12
With the inclusion of new Chinese companies in the ODMD list, the total number of brands in the market has reached 54.
Recently, there has been a significant increase in the interest of Chinese brands in Turkey, and this has also been reflected in the number of companies entering the market.
In the Turkish automotive market, there are 10 Chinese brands, including Skywell, MG, Chery, Leapmotor, Seres, Maxus, Hongqi, DFSK, BYD, and NETA. It is expected that the number of Chinese brands will increase to 12 with the addition of SWM and Jaecoo brands to this list in the near future.
While DFSK and Chery sell cars with internal combustion engines in the Turkish market, MG offers both electric and internal combustion engine models, and other brands showcase their electric models. Voyah, which sells luxury segment cars, is not listed in the ODMD. In addition, DFSK and Maxus also sell light commercial vehicles.
THE SHARE OF CHINESE BRANDS IN THE TURKISH MARKET
The total sales of Chinese automotive companies (cars and light commercial vehicles) in Turkey reached 38,395 units in the first 5 months of the year, and their share in the automotive market reached 8.13%.
Among Chinese brands, DFSK and Maxus also have commercial vehicle sales. When only car sales are considered by excluding the light commercial vehicle sales of these two brands, the number of car sales by Chinese brands increased to 38,019 units, and their market share reached 10.13%.
THE BEST-SELLING CHINESE BRANDS
Looking at the sales figures of Chinese automotive companies in Turkey in the January-May period, Chery ranked first with 26,990 sales. MG, with 9,478 sales, came second, and BYD, with 1,065 sales, came third.
DFSK ranked fourth with 346 sales, including both cars and light commercial vehicles, while Maxus ranked fifth with 190 sales.
THE SALES FIGURE WAS BELOW 1,000 IN FEBRUARY 2023
Looking at the February of last year when Chery and some Chinese brands had not yet started sales, the total sales of Chinese brands remained below 1,000 units. In the whole of 2023, Chinese brands reached a share of 6.10% with 59,097 sales in the total Turkish car market of 967,341 units.
Thus, it was observed that Chinese brands strengthened their position in the Turkish market in terms of both sales figures and market share.
THE SHARE OF CHINESE BRANDS AMONG IMPORTED VEHICLES IS 11.69%
On the other hand, in the January-May period, domestic vehicle sales were 146,727 units, while imported vehicle sales were 325,016 units out of a total market of 471,743 units. Thus, imported vehicles accounted for 68.89% of the total market.
Among imported vehicles, the share of Chinese brands reached 11.69%.
TURKISH AUTOMOTIVE INDUSTRY AWAITS INVESTMENT FROM CHINESE, NOT IMPORTS
Cengiz Eroldu, the President of the Automotive Industry Association (OSD), stated at the last OSD meeting in April that the Chinese should invest in Turkey instead of importing.
Eroldu had also stated in previous statements that, from Turkey's perspective, China poses a problem not only for the automotive industry but also for the trade balance within the country, and that some rules applied to electric cars coming from China should also be applied to internal combustion engine vehicles. He used the following statements:
"We see this situation as a risk for not only the automotive industry but also for the country's industry as a whole. In our opinion, this is another issue that needs to be managed in 2024 because it seems that the damage caused by China's imports to Turkey's foreign trade balance cannot be solved by simply applying some practices to electric cars. We are not against Chinese vehicles as the automotive industry, but they need to come and invest. So, we invite Chinese investors to come and invest in Turkey, and the Ministry also has studies in this regard. Chinese investors need to come and invest in Turkey. As the automotive industry, we find competition positive, but losing this market only through imports is not the right thing to do."