Developments in the automotive sector
The Turkish automotive market demonstrated record growth in 2020, mainly on the back of changing transportation preferences of individuals amid COVID-19 pandemic, falling interest rates on auto loans, a surge in demand for commercial vehicles with the help of the growth in e-commerce, an expectation that car prices would soon rise and the low base effect from 2019. According to the Automotive Manufacturers Association (OSD), total sales increased by 62% to 796,200 units in 2020. Sales of passenger vehicles increased by 58% when compared to the previous year to reach 610,109 units, while sales of light commercial vehicles increased by 77% to 162,679 units. A total of 23,412 heavy commercial vehicles were sold, marking a rise of 82% when compared to the previous year.
Halts in production within the scope of pandemic measures and the contraction in international markets negatively affected automotive exports and production in 2020. According to OSD data, Turkish automotive exports fell by 27% yearon-year in 2020 to end the year at 916,543 units, while export revenues in the sector came in at USD 25.9 billion, decreasing 17%. However, the automotive sector remained the leading industry in Turkish exports. In Europe, Turkey’s most important export market, demand for passenger cars declined by 24% compared to the previous year while demand for light commercial vehicles declined by 18%. Despite a weakening in export demand and production halts, buoyant demand in the domestic market limited the contraction in automotive production, which decreased by 11% yearon-year to 1.3 million units.
In 2020, the Turkish bus market increased by 2% compared to the previous year, excluding intercity bus segment. Total bus exports, on the other hand, declined by 27%.