Türkiye’s automotive industry needs to ramp up its efforts for green transition, or else it may lose its export markets, warns an expert.
The European Union’s carbon border adjustment mechanism (CBAM) will come into force in 2026, and alarm bells are ringing for the local carmakers that export 80 of their products to EU countries.
If the local industry fails to take steps to reduce carbon emissions, it may lose its competitiveness, said Mehmet Ali Öztopçu from Yazaki,one of the world’s largest car parts makers.
“Only 20 percent of the companies in the Turkish auto industry are able to calculate their carbon footprint,” Öztopçu said, adding that even less than 20 percent of the companies are taking steps toward reducing their carbon footprints.
The bloc’s CBAM offers huge opportunities and at the same time poses big challenges for the Turkish auto industry, he added.
For the time being, Türkiye appears to be an appealing market because of low production costs, Öztopçu said.
“Yet, if we do not comply with carbon reduction rules and do not make proper calculations for carbon emission, we may lose our competitiveness, which will mean a decline in production and employment,” he warned.
However, despite the mounting challenges, he voiced optimism that the CBAM can create opportunities for the local auto industry.
The mechanism offers huge opportunities to lure investments to Türkiye, according to Öztopçu.
“Türkiye has the potential to become the ‘green production center’ in Europe. We can offer an alternative by generating green energy from renewables such as solar and wind power.”
If Türkiye moves in this direction, it will definitely attract investments, Öztopçu said. “The greener we go, the greater the changes that auto companies in Asia chose Türkiye for production. More investments from Europe could be possible. With policies in line with CBAM, we can protect or even increase our competitiveness.”
Türkiye’s auto industry has an annual production capacity of 2 million units. The local industry employs more than 500,000 people.
It ranks fourth in the EU and 14th in the world in terms of production.
From January to August, the auto industry’s export revenues increased more than 17 percent from a year ago to $23.3 billion. Total production rose 13 percent to nearly 944,000 vehicles, with passenger car output rising 21 percent year-on-year to some 600,000.