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Turkey 2013 | DEFENSE & AEROSPACE | REVIEW: DEFENSE

The Turkish defense industry is looking to establish its name in the international market and begin exporting to more countries.

For many years, Turkey was largely an importer of weapons from other countries; however, this is starting to change as more domestic companies are beginning to develop and manufacture their own products. The sector is moving to make advanced and high-tech weaponry such as helicopters, tanks, naval vessels, and drones. It became evident in the switch in roles that the industry took at the premier defense exhibition, the International Defense Industry Fair (IDEF), held in Istanbul in May 2013 when, for the first time, Turkish arms producers opened the fair. The country was there to sell its products to the world. The IDEF has been held every year since 1993 and regularly hosts 800 defense companies from around the world from 49 different countries. The IDEF was the ideal event for Turkish companies to showcase their new unveilings, such as the TAI Anka UAV, which finished testing in April 2013.

In May 2013, the Undersecretariat for Defense Industries (SSM) valued the sector's defense contracts at TL45.4 billion, an 85% rise from 2008, when the value was TL24.5 billion. The country had a total of 310 standing projects in 2012, with 180 bound by contract. Companies such as Armsan and FNSS Savunma Sistemleri are examples of the sector's success. Armsan is a relatively new company that began in 2006 and is establishing itself in the domestic and international market. The company currently produces 3,500 shotguns per month, making it the third largest manufacturer in the Turkish shotgun sector. “In 2012, 88% of our production was for export, but we are continually increasing our production capacity to meet the demands," Şafak Atilla, General Manager of Armsan, told TBY. The company exports its shotguns to over 40 countries and mainly relies on exports as its core business. The shotgun sector is worth $200 million out of a total of $1.5 billion for the small arms sector. FNSS Savunma Sistemleri was the first private defense company set up in Turkey in 1988. It started out producing armored combat vehicles (ACVs) for the Turkish Armed Forces. Now, the company makes an average of around $100 million a year, while in 2012 it jumped to $180 million. “Based on our research and analysis, our plan is to reach levels of $400 million to $500 million a year," K. Nail Kurt, CEO of FNSS, told TBY.

Another important company is Turkish Aerospace Industries (TAI), which was established to produce the F-16 aircraft in a joint venture with Lockheed Martin. The company is valued at between $3.5 billion and $4 billion, with annual revenues of $850 million, making it the 83rd largest defense and aerospace company in the world. TAI produces the Anka Medium Altitude Long Endurance (MALE) Class UAV system, the T129 Attack helicopter, and the C-130 Avionics Modernization Suite. The company is also a part of another joint venture with Lockheed Martin to produce the F-35 aircraft.

HOMEGROWN

The defense industry is heavily focused on national self-sufficiency when it comes to arms. “R&D investments now approach $1 billion per year, and we are already seeing the results of that investment," Murad Bayar, Undersecretary for the Defense Industries, told TBY. One of the newest developments to go into operation is the Anka UAV. It is produced by TAI for the Turkish Air Force, has a range of 4,896 kilometers, and can fly at an altitude of 7,900 meters. Turkey is the third country after the US and Israel to be able to produce its own MALE Class UAVs. The Anka can be used for tactical surveillance and reconnaissance. TAI is currently developing the Anka+A, which will be a “hunter killer" and fitted with Turkish made Cirit missiles.

In partnership with AgustaWestland, TAI also produces the T129 attack helicopter. The project cost $3.2 billion and was based on the Agusta A129 Mangusta. The T129 will carry 12 Roketsan-developed UMTAS anti-tank missiles, which are Turkish designed and manufactured rockets similar to that of the US Hellfire II. The Turkish Army has ordered 60 of the helicopters, but there is reported interest from Saudi Arabia, Jordan, Malaysia, and Pakistan.

Turkey is also developing its own main battle tank (MBT) called the Altay, the first such to be developed in the country since 1943. The Defense Industries Executive awarded the contract worth $500 million to Otokar in 2007, and it should be in service by 2015. Otokar has produced well over 25,000 military vehicles and is a company owned by the Istanbul-based Koç Holding.

The MİLGEM project is a national program with an aim to build a modern combat warship with domestic weaponry, while also using the principles of stealth technology. The result was the Ada Class corvette. They are built in the Istanbul Naval Shipyard RMK Marine and currently there is one on active duty. There are a further two that are completed, three that are laid up, 12 planned for the future, and six that are under construction, which will cost a total of $1.5 billion. The flagship of the MİLGEM project, the TCG Heybeliade (F-511), required an investment of $260 million and was commissioned in September 2011.

EXPORTS

In the future, Turkey will now be looking to increase the amount of exports the defense industries ship. The country as a whole has a plan to increase its exports to $500 billion by 2023, while the SSM wants the defense sector to take a 5% share at $25 billion. This could well be possible once Turkey makes a name for itself by producing reliable weapons and instilling confidence in buyers.