Recently, the Turkish government announced a major trade decision, imposing a 40% tariff on all cars imported from China from July 7, and a minimum tariff of 7 000 US dollars (about 50,000 yuan) per car. Turkey's Ministry of Commerce mentioned in a statement that the move is aimed at increasing the market share of domestically produced vehicles, reducing the account deficit, and protecting the development of the country's automobile manufacturing industry.
Back in March 2023, Turkey imposed an additional 40% tariff on EV imports from China, bringing the tariff to 50%. In addition, according to the previous decree issued by the Turkish Ministry of Trade, all companies importing electric vehicles must establish at least 140 authorized service stations in Turkey and set up a dedicated call center for each brand.
Cengiz Eroldu, president of the Turkish Automobile Manufacturers Association (OSD), recently said that the tax on electric vehicles imported from China is not enough, as 78% of cars imported from China are internal combustion engine vehicles. This has also led directly to Turkey's expansion of the tariffs from Chinese electric vehicles to all types of power vehicles in China.
It is worth noting that just a week before the tariff was announced (June 4), the Turkish foreign minister visited China and met with high-level officials from the mainland. During the talks, the Turkish foreign minister not only expressed the hope of strengthening economic and trade ties with China, but also proposed that Turkey become a new channel between China and Europe, and a trade bridge between China and Europe. In addition to this, the Turkish Foreign Minister also expressed his desire to become a BRICS partner country.
However, before the dust has settled, Turkey has already taken action against China. At a sensitive time when the United States has recently taken measures to increase tariffs on China, and the European Union is waiting to see whether to impose heavy tariffs on Chinese electric vehicles, Turkey's actions are both unexpected.
"Turkey is not a member of the European Union, but it is a member of NATO, and it has signed a tax alliance agreement with the European Union, which is more like following in the footsteps of the United States, and at the same time acting as an outpost for the European Union to impose tariffs on automobiles." Analysts said.
Turkey is located at the throat of the Eurasian continent and has a certain industrial strength, but the automotive industry is weak, and foreign brands occupy the vast majority of the market, so it is quite attractive to Chinese car manufacturers.
At present, the main Chinese car brands in the Turkish auto market are Chery, SAIC MG, BYD, Celis, Leapmotor, Nezha Automobile, FAW, Dongfeng, etc. According to the latest data from the China Passenger Car Association, from January to April this year, the total sales of Chinese car companies in Turkey were 29,500 units, accounting for 7.95%. Among them, the sales of Chery, SAIC, BYD, Celis, Leapmotor and Nezha Automobile in Turkey were 20,800, 7,353, 862, 261, 81 and 53 respectively, accounting for 5.6%, 1.98%, 0.23%, 0.07%, 0.02% and 0.01% respectively. From 2021 to 2023, Chinese automakers accounted for 0.07%, 0.25%, and 4.84% of the total sales in Turkey, respectively. In the first four months of this year, the market share of European brands in Turkey reached 64.23%, Japanese brands accounted for 10.2%, and American brands accounted for 8.04%, which is a significant gap compared with the market share of Chinese brands.
It is worth noting that although the current market share of Chinese cars in Turkey has not yet occupied a dominant advantage, there are also relevant data showing that in the electric vehicle market, Chinese brands occupy nearly half of the market share, which has an impact on the implementation of local new energy vehicles in Turkey.
At present, the Turkish government is actively promoting the development of the new energy vehicle industry, and has introduced a series of preferential policies, including purchase tax reduction and exemption, providing car purchase subsidies, etc., to encourage the popularization of new energy vehicles. According to the Turkish Automobile Distribution and Mobility Association, the total market for automobiles and light commercial vehicles in Turkey reached 1.233 million units in 2023, an increase of 57.4% compared to the previous year. Among them, 66,000 pure electric vehicles were sold, accounting for 6.8% of total sales in Turkey, compared to only 1.2% in 2022. The Turkish energy market regulator expects the number of electric vehicles in Turkey to increase by about 180,000 by 2025.
According to other data, Turkey exported more than 950,000 vehicles to the international market in 2023, accounting for about 70% of local production, making it the second largest European car exporter after the United Kingdom. If the EU can "curry" itself with tariffs on China, the Turkish auto industry will also gain a better external environment.
Turkey's tariffs are a challenge for Chinese automakers. The implementation of this policy will directly increase the cost of sales of Chinese cars in the Turkish market, reduce price competitiveness, and lead to a slowdown in growth, especially for brands with small sales scale, which are likely to face losses. This means that Chinese automakers need to re-evaluate their strategic presence in the Turkish market and consider whether it is necessary to establish more service networks in the Turkish market, or to find other partners or channels.
However, there are also positive voices on the matter. Cui Dongshu, secretary general of the passenger association, said in response to a reporter's question: "After the last tariff increase, the performance of Chinese car companies in Turkey is still excellent, and after the tariffs are imposed this time, the development of Chinese car companies has been hindered to a certain extent, but due to the large trade deficit and the underdevelopment of the local car industry, Chinese car companies should be able to overcome the challenge." "In the long run, a series of tariff increases will also force Chinese automakers to seek a more stable and diversified development path in the global market, thereby mitigating the risks brought about by policy changes in the single market.