Automakers warn of growing trade imbalance with China

ISTANBUL

Türkiye imported $2.2 billion worth of vehicles and auto parts from China last year, while auto parts exports to this country were only $21 million, says Cengiz Eroldu, the head of the Automotive Manufacturers’ Association, OSD), warning of the growing trade imbalance with China in the industry. 

Some 59,214 Chinese cars were sold in Türkiye in 2023, corresponding to 4.8 percent of all vehicle sales that year.

Around 20 percent of the cars imported from China were electric vehicles (EVs), Eroldu noted.

“Measures put in place against Chinese EVs alone are not enough to repair the damage inflicted by Chinese imports. Similar steps should be taken for Chinese combustion engine cars,” he said.

Toward the end of 2023, the Trade Ministry issued a decree that requires companies importing EVs to have authorized service stations in seven regions of the country. Imports from the EU and countries having free-trade agreements with Türkiye are exempt from the decree.

Representatives from the auto industry had predicted that the new regulations would hit Chinese brands particularly hard.

“We are not against competition, we are not against Chinese. But Chinese carmakers must invest in Türkiye… When they invest, Chinese companies will bring new technologies and strengthen the Turkish automotive industry,” Eroldu said.

Chinese firms are capturing a larger share in the local market without making investments in Türkiye, Eroldu added. “This is not fair… Losing the market to imported cars is not fair.”

The share of local carmakers shrank in the Turkish market last year when over a record 1.2 million vehicles were sold, according to Eroldu.

“For the first time in years, the local auto market posted a trade deficit. The share of local carmakers in the market declined from 45 percent to 37 percent,” he said.

Meanwhile, the data OSD released on Jan. 14 showed that the auto industry’s production increased by 8.6 percent last year from 2022 to reach 1.47 million vehicles.

Passenger car production grew 17.5 percent compared with the previous year to climb to 953,000 units in 2023.

Türkiye imported around 817,000 vehicles last year, up 80 percent from 2022, with passenger car imports also rising 80 percent to more than 650,000 units.

Local carmakers delivered over 1 million vehicles to foreign markets, increasing their export revenues by 13.3 percent to $35.7 billion last year.