REV-OLUTIONARY MANUFACTURING

Turkey 2014 | INDUSTRY & MINING | B2B: HEAVY AUTO

Car manufacturers are finding conditions in Turkey favorable for innovative production and finding clients.

Rainer Genes
RAINER GENES
President & CEO
Mercedes-Benz Türk
Dinçer Çelik
DINÇER ÇELIK
General Manager
TEMSA

Where does Turkey fit into the company's global strategy?

RAINER GENES Turkey is becoming increasingly important for the global automotive business. The Turkish automotive industry fulfills the demand in domestic and export markets, and the interest of foreign investors in this sector is increasing continuously. The reason for this is that Turkey has highly educated and competent work force, favorable labor costs, solid know-how, and a growing domestic market. This adds up to a highly promising commercial environment, and we seek to strengthen our position in it. Of course, the labor costs in Turkey are not as favorable for us as they are in certain Eastern European countries, but the combination of factors like the quality of the work force, the level of competency, and labor costs makes the environment highly attractive.

DİNÇER ÇELİK Since the late 1980s, TEMSA has enjoyed a strong presence in the Turkish bus market. But in 2002-2003, we increasingly looked towards Europe, making new product investments for European markets. In the domestic market, TEMSA had a few star products but never really became a strong player. However, as of 2013, TEMSA's market share rose strikingly, making us the number two player in Turkey for coaches and city buses. Next year, we will probably have 25% to 30% market share, up from 10% to 15%. The domestic market is poised to play a strong role, and we are going to be the main player here. This year, we have introduced five new products, with one launched earlier in 2014, all of which will bolster our domestic standing.

How are you committing to Turkey through investment and promoting the brand abroad?

RG Today, approximately 350 people are working in our R&D center, and it is an important part of the overall global bus and truck R&D network of Daimler. In future, we will extend the field of our responsibilities in this network. Another focus of our current investment activities is on capacity increases in our bus and truck factories. We have already started investing in our Aksaray Truck Factory and will continue in the bus factory in Istanbul. An important success factor in automotive production is the localization of parts. To make the most out of the advantages that Turkey offers, it is important to have a high local content in the products. In order to achieve this, we have to further qualify our supplier base and invest in additional tools and equipment for the Turkish market.

This is a unique part of what TEMSA is doing. We are the first Turkish automotive company associated with the “Turquality" program, and TEMSA has opened several sales offices in Europe to establish connections with local municipalities and customers. We used this strategy very heavily during 2007-2008. Nowadays, we are establishing a mixed sales channel structure. TEMSA was the first 100% Turkish-owned company to represent Turkish automotive industry outside Turkey.

Where do you see the company in the next decade?

RG Hopefully, the company will maintain the same strong and leading position that we enjoy today. That is a challenge considering the sheer competition, which continues to grow. We have state-of-the-art production facilities and competitive products. We also have a strong sales and after-sales network in Turkey. In the next decade we will concentrate on strengthening our leading position.

TEMSA has already secured a healthy order log that will keep us full over the next 10 months, an unprecedented position for us that provides flexibility to plan the future. We have already decided on the products that we will introduce over the next two years. And over the next five years, there will be at least one new product for the US market, two for the European market, and three for the domestic market. Most of these will be built on the same platform, which will bring high-level cost advantages. In the domestic market, we will be a player in all segments in the next five years, geared at closing the gap on the available product range.