The Transforming Automotive Industry and Turkey’s Potential

Three concepts will undergo a radical transformation in the next 10 years. These are the automobile, the driver and the automotive industry located at the heart of this transformation

Automobile; an invention that radically changed personal and social lives, state economies, architecture and urban planning. These vehicles not only enable people to easily go from one place to another but also empower economies by providing freedom of travel, quality of life, status, new job opportunities, and employment areas. Hence, they have become much more than a comfort tool. But all these things come at a price. The increasing number of vehicles causes environmental and noise pollution, drifting away from human-oriented urban planning, traffic & parking problems, and high costs. And all of these have made the giant metropolises of our day uninhabitable.

But human nature is capable of producing solutions to the problems it creates. Today, the automotive industry is undergoing an innovative technological transform to answer these problems. Societies, companies and states that make good use of this chance and invest in the future are likely to be the leaders of the future.

We can easily say that the three concepts of the automotive industry will undergo a radical transformation in the next ten years: automobile itself, the driver of the vehicle and the automotive industry located at the heart of this transformation.

Radical Transformation in the Automotive Industry

Automotive has always been one of the first industries to adapt to technological innovations. Driving and safety technologies such as adaptive cruise control, lane tracking, blind spot detection and anti-collision systems, autonomous parking and driving have started offering us travel experiences that we couldn’t even imagine before.    

The sector has undergone a radical transformation with new technologies. And the first leg of this process is electric cars. Elon Musk, the crazy CEO of Tesla Motors, put electric cars into the agenda of the automotive industry with his efforts. Only 17-year-old Tesla is now standing against age-old automotive companies. This unexpected success of Tesla broke the traditional rules of the industry and unseated some executives resisting this transformation. Although it took some time for the industry giants to understand how internal combustion engines are coming to an end, the emission scandal of a world-famous automobile brand created this unexpected opportunity. As the details of the scandal came to surface, it was revealed the issue was not only limited to certain brands but the automotive industry itself was also seriously threatening human health. After that, switching to electric cars with cleaner and quieter engines became a priority.

Electric Car Sales Are Increasing

International Energy Agency’s report shows that the number of electric cars sold worldwide is more than 5 million. Only in 2018, the number of vehicle sales using electric energy is roughly 3.5 million, including plug-in hybrid vehicles. The total number of vehicles sold worldwide in the same year is 79 million. In fact, the total number of electric cars in the market only constitutes 2.2% of the global automotive industry. This big difference may not seem very promising. But the electric car market’s increase from 300 thousand to 3.5 million between 2013-2018 changes this scenario. It is expected in the next 10 years that this number will increase incrementally and the number of electric cars in the market will reach 250 million globally by 2030.

But there are still serious obstacles that prevent electric cars from getting more popular. Adopting the habit of using “battery ranges” is one of the most important issues in this regard. But the new generation batteries now seem to solve this issue.

The cost of electric cars is also a problem. To manufacture an electric car, 12 thousand dollars more is required than a vehicle with a traditional internal combustion engine. This price difference is no doubt too high for an average consumer. Government incentives play an important role at this point.

Another issue is the infrastructure investments for the use of these vehicles. Quick charge stations are needed in all corners of the country for customers to opt for electric cars and have safe and comfortable driving experience. It is also very important to create infrastructures that will enable charging the cars at home.

Turkey’s Domestic Automobile Project: TOGG

This radical transformation expected within the next 10 years is also a new opportunity for the economies of many countries. China has already started to lead the world. China is the home to nearly half of electric cars on the market today and the world leader in the electric car market with its giant economy. The country’s volume is three times bigger than Europe’s and America’s.

And the export leader of the automotive sector, Turkey is just getting familiar with this transformation. Turkey’s electric car market is still very young. Turkey Electric and Hybrid Vehicles Association (TEHAD) data show that the number of electric cars in Turkey is only 617 in the last five years. When hybrid cars are added to this mix, the market is getting a little bigger.  The numbers show us that our country’s electric car infrastructure is not at the desired level yet. Besides, the awareness of the drivers is not very high. However, Turkey has acquired a powerful opportunity to be an important actor in the industry throughout this 10-year-period: Turkey’s Automobile Joint Venture Group – TOGG.

Turkey’s domestic automobile project TOGG was recently launched. The prototypes of the car were shared with the press, and the most important feature is that it is 100% electric. The cars are planned to be put on the market by 2022 and can receive great support if they are sold at an affordable price. Thus, while creating an international brand for Turkey; electric car infrastructure, new sales channels, charging stations and service infrastructure will also be created and the awareness will be raised in this process.

With this in mind, many companies making investments in charging stations in Turkey have already started preparing for the time when TOGG will be on the roads. And this shows that an important step is taken to provide a sufficient number of charging stations all around Turkey.

On the other hand, with the introduction of autonomous driving technologies, competition in the industry is getting hotter. Each new development paves the way for the new actors. So, how will Turkey compete in this market? Can it be a leading country with its technology, human power, brands and infrastructure?  The opportunity awaits us, and it is up to us to seize it.

Journalist  Ozan Onat