Situated between Asia and Europe, Turkiye is itself exciting manufacturing, commercial market, also ‘at heart of other supply chains’ says Rhenus CEO
Germany’s logistics giant Rhenus, operating in Europe, Asia, and South America, considers Turkiye the heart of various supply chains as the shock of the coronavirus pandemic demonstrated the importance of the logistical availability of factories.
“That’s why we’ve invested heavily in Turkiye over the last two years to ensure that production is stable and reliable so that supply chains can really work,” Tobias Bartz, Rhenus’ CEO, told Anadolu Agency in an exclusive interview.
The coronavirus pandemic, a global shock that hit health care, trade, finance, education, business, and societies like few other ordeals in the past century, was “extremely worrying,” Bartz said, adding that at times, the supply chain “disappeared”.
“We saw a little bit of light at the end of the tunnel after months,” he said of the virus outbreak, which affected the global economy via regular supply and demand channels.
Following the supply shock that began in China in February 2020, a demand shock took hold as the global economy shut down, exposing vulnerabilities in the production strategies and supply chains of firms across the world.
Bratz emphasized that supply chain “uncertainties” during the pandemic were prompting more businesses to bring manufacturing closer to home.
“I think we can see now that certain factories are closing and opening in different parts of the world. Logistical availability becomes more and more important,” he said.
Shifting global supply chains
The pandemic posed significant challenges for supply chains globally. Multiple national lockdowns temporarily stopped the flow of raw materials and finished goods, disrupting manufacturing as a result.
Many multinational companies increased their plan to move production chains closer to home in order to minimize problems with global supply chains and increased shipping costs.
According to research by Buck Consultants International, more and more European industrial companies are bringing back production that they had previously offshored. Straddling Europe and the Middle East, Turkiye hopes to utilize its strategic location and strong manufacturing base to benefit from changes in the global supply chains.
The country poses a strong alternative to the pre-COVID production network based in Asia as its sole center.
Turkiye offers easy access to 1.3 billion people and a combined market worth $26 trillion in GDP in Europe, the Middle East and North Africa, and Central Asia within a four-hour flight radius.
Explaining that Rhenus has been working in the Turkish market for many years through their agencies, Bartz said the company had maintained investments in Turkiye for three years now.
“We see the future in the country not only because it is an exciting production and commercial market in itself, but also because it is at the heart of other supply chains,” said the company’s CEO.
Pointing to Turkiye’s geographical advantage, as well as its highly skilled workforce and strength in product and production, he said Rhenus is “looking at connecting Kazakhstan, Azerbaijan, Georgia” with that country.
Turkiye has global market access at the nexus of Europe, Asia, and Africa, thus creating an efficient and cost-effective hub to major markets.
The country’s strategic location enables easy reach to markets across 16 different time zones, from Tokyo to New York.
Bartz said Turkish people are talented, culturally open, and connected with Europe, and the logistical infrastructure is also good.
“The road supports the structure of the railway. It is something that we benefit a lot from,” he said, adding that the company hoped to benefit from the human resource market in Turkiye. “We want to add these people to our global network.”
Multinationals are increasingly choosing Turkiye as a preferred hub for manufacturing, exports, as well as management.
Bartz said companies are seeking to spread their risks in Asia and also globally, and in this case, Turkiye and India will be the winners at the highest level.
Rhenus is a family company based in western Germany that has been operating in the logistics industry for more than 100 years.
Bartz added that the company operates in 52 countries and has approximately 40,000 employees, adding that it had reached a turnover of €7 billion ($6.96 billion) in 2021.