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Automotive Industry: Emrah KUTLU Zeynep AVCIOĞLU
Automotive Industry: Emrah KUTLU Zeynep AVCIOĞLU
Automotive Industry: Emrah KUTLU Zeynep AVCIOĞLU
AUTOMOTIVE INDUSTRY
Key driving sector of the economy Closely tied to other sectors of the economy Prime buyer in basic industries Requires complex and multidisciplinary technology
AUTOMOTIVE INDUSTRY
Intense competition in the market
Intensive R&D Fastest developing sector in the global economy
TURKEY
mid 1950s 1954 Trk Willys Overland Ltd. Tofa, Renault, Ford
Joint ventures
MARKET STRUCTURE
Highly labor and capital intensive
Majority of costs for producing - Labor - Materials - Advertising
MARKET STRUCTURE
PORTERS FIVE FORCES MODEL
MARKET STRUCTURE
The auto industry is considered to be an oligopoly. Today there are 15 companies in production of which 5 are automotive producers and 10 are commercial vehicle producers.
MARKET STRUCTURE
The automotive industry is one of the four largest exporters. Significant contribution to: - National production and development - Employment - Level of technology
MARKET STRUCTURE
Table- 1 PRODUCTION IN TURKEY
MARKET STRUCTURE
The companies in the sector are mainly located in the Marmara Region. Existing motor vehicle production capacity of the automotive industry in Turkey is 1,015,000 units per year, as of 2002.
Source:OSD, 2002
2 3 4 9
2 11 4 7
FORD OTOMOTV SAN. A.. TOYOTA OTOMOTV SANAY TRKYE A.. OYAK-RENAULT OTOMOBL FABRKALARI A.. TOFA TRK OTOMOBL FABRKASI A..
1 2 3 7
ADAPAZARI
3,348,031,394
STANBUL
2,966,839,536
STANBUL
2,146,938,617
16
17
STANBUL
12
1,218,993,109
CONDUCT
LEADING EXPORTING COUNTRIES
France Germany Italy UK
Table- 4
Source: www.wbr.co.uk, About the Turkish Automotive Industry
2002
53,121
61,294
86%
CONDUCT
PRODUCT DESIGN
-Design of Textile and Textile-Based Products Used in Automotive
-Designing Commercial and Public Transport Vehicles Like Trucks, Buses,etc.
- Development and Redesign Work for Currently Produced Automobiles Towards New Markets
-Design Work Towards Developing Accessories and Products of Special Functions - Prototype Processes of Vehicles Designed Abroad and Design Work Concerning Test Production
CONDUCT
PARTNERSHIPS
PERFORMANCE
SWOT ANALYSIS
The Strength of the Turkish Automotive Industry
Economically
a) Third major sector in Turkish manufacturing industry b) Leading private sector investor c) Driving force in manufacturing industry with its high value added d) A reliable source of tax revenue with its totally registered production
PERFORMANCE
Human Knowledge
a) High-skilled human resources both in production and management b) Sustainable and improvable competitive workforce with low labor cost and culture of productivity c) Accumulated technological know-how and rapidly growing investments in R&D d) Quality management systems e) Widespread distribution and marketing networks f) Integration with world automotive industry since 1990s
PERFORMANCE
Geostrategic Importance
a) The most developed automotive industry and a unique export and production base in the region with close bilateral relations with EU, G8, Eurasia Export experience and strong export markets Easy access to potential emerging markets
b) c)
PERFORMANCE
The Weakness of the Turkish Automotive Industry a) Unstable domestic market b) Loss of quality and quantity in manpower as a result of the crises caused by the weak economy of the country c) In adequate investments in the sector d) High costs of raw materials due to capacity utilization and production below economies of scale e) High sales taxes and gasoline prices f) Lack of international strategy g) Excess capacity h) Insufficient export incentives
CONCLUSION
Globalization will continue increasingly in the automotive sector. The automotive industry in Turkey is in a position where it can produce at global standards. It has developed its competitive capabilities, and a structure that can apply common marketing strategies with licensing countries. The sector is able to create more added values. Having a competitive structure, having the power to manufacture quality and consistent products with new technologies, and most effectively, having the cost-price advantage, puts Turkey in a position of being an important manufacturing base and an important market, from the perspective of the global automotive.