Could Türkiye’s 1st electric vehicle become globally competitive?

Türkiye’s first domestically-produced electric vehicle (EV) is displayed in Ankara, Türkiye, Nov. 9, 2022. Photo: Xinhua

 

Türkiye’s first domestically-produced electric vehicle (EV) is displayed in Ankara, Türkiye, Nov. 9, 2022.Photo:Xinhua

 

Türkiye’s first domestically-produced electric vehicle (EV) unveiled in October has marked a breakthrough in the country’s automotive industry, but there is still a long way to go before this EV could compete on the global stage, business insiders said.

At a ceremony marking the 99th anniversary of the foundation of the Turkish Republic last month, President Recep Tayyip Erdogan presented the country’s first EV, a compact SUV manufactured by Türkiye’s Automobile Joint Venture Group, or Togg.

The compact SUV will start to take orders from Turkish customers in February, 2023 and see its market launch a month later.

Founded in 2018 and backed by the state, Togg is highly valued by Erdogan who has followed it closely as a prestige project to increase Türkiye’s independence from foreign carmakers.

“When the Togg facility reaches its full capacity, 175,000 vehicles will be produced here annually. By 2030, 1 million vehicles will be produced here,” the Turkish leader said during the televised event.

“Initially, the target was a traditional internal combustion engine, but in the light of the transformation the automotive industry has been going through, it was then decided to produce an EV instead,” Emre Ozpeynirci, a journalist and automotive expert, told Xinhua.

Ozpeynirci hailed the project as the right move toward the rise of Türkiye’s car industry but pointed out that it would take a long time before it could be commercially competitive.

“Can it be competitive globally? It can, but in 10 years,” he said, adding more parts of the EV should be manufactured domestically if overseas markets are targeted.

While the Togg vehicle is designed and assembled in Türkiye, components like batteries, engines and some electric systems are imported, according to the local press.

To date, 51 percent of materials used to build the vehicle are made in Türkiye, according to Industry Minister Mustafa Varank, seeking to raise the proportion to 65 percent in coming years, semi-official Anadolu Agency reported.

Moreover, Ozpeynirci highlighted enough production capacity as one of the ultimate goals for Togg which has set its first year’s production target at only 18,000.

“Today, if you want to have a globally competitive car, you have to produce at least 1 million cars and even more,” he explained.

At the first stage, according to Ozpeynirci, Togg’s cars will only be offered in the domestic market at an estimated price of about 900,000 Turkish liras (48,443 U.S. dollars), which is unaffordable for most Turks struggling with an economic downturn not seen in decades.

“The clients of this car are expected to be public institutions, the public sector in general, or different trade unions,” Ozpeynirci said.

A more affordable model is expected to hit the market in 2027, the expert added.

In a picture published on Twitter, Togg announced a sedan and a coupe as further planned models.

According to another expert who didn’t want to be named, the national car will be offered in the coming years to potential customers in Germany, Belgium, and the Netherlands which have sizable Turkish communities.

Meanwhile, analysts said the risk of a global recession may slow down consumers’ shift to electric vehicles which would pose a further challenge to the Turkish electric car.

The cost of going through a crisis, particularly in the European Union and the United States, is forcing many to delay switching to a more environmentally friendly vehicle, Enver Erkan, chief economist at Istanbul’s Tera brokerage house, told Xinhua.

“There is a desire to switch to EVs, but the funds are lacking. People who are in recession and suffer a high cost of living have reconsidered their spending in favor of the most essential,” he said.