Higher-than-expected performance of Turkey's automotive industry in 2010 signals another promising year ahead, according to Turkish carmakers.
Turkish automotive industry's sales hit peak level in 2005 with nearly 729,000 units. This year, carmakers expect to close the year with some 730,000 units.
In first 11 months of 2010, the industry sold 612,544 passenger cars and light commercial vehicles, outpacing the previous year that closed with more than 557,000 units, a number boosted by tax cuts which was part of government's stimulus package against crisis.
Mustafa Bayraktar, head of Turkey's Automotive Distributors' Association, said that the target for 1 million units could be achieved and upward trend of car sales could be maintained only by the help of further tax cuts.
"I expect a market volume of 750,000 units in 2011. In case of a 'cash for clunkers' incentive, tax cuts and electric car tax rebate, the target for 1 million units is not impossible. Moreover, rise in sales could cause an increase in government's tax revenues in spite of a tax reduction," Bayraktar said.
Also, Turkey's auto exports showed an increase this year parallel to rise in domestic sales.
Turkish carmakers ship most of their products to European countries that have seen a slow recovery after the global financial downturn. However, alternative markets paved the way for a surge in exports.
In first 11 months of this year, Turkey's automotive exports climbed 16 percent year-on-year to $15.6 billion. Turkey's largest export partner was France, followed by Germany, Italy, UK, Spain and Russia.
"Industry's performance will most probably depend of the general course of global economy and especially on EU market. However, if we take into account our expectations for a total output of 1.1 million units and an export size around $18 billion by the end of this year, I think 1.2 million units and $20 billion export target would be reasonable for 2011," said Orhan Sabuncu, chairman of Automotive Exporters' Assembly.