Investment knocking on automotive supply industry door despite ‘Turkey’s lost image’
Omer Burhanoglu, the chairman of the Automotive Subsidiary Industry Specialized Industrial Zone (TOSB), has said an unannounced global company is ready to invest in the region, but that investment plans might yet be delayed by a lack of land in the coming period.
“At the moment we are about to sign a huge investment project with a global company that will produce in our empty parcel of TOSB. There seems to be no delay in our plans but there may be problems in the near future since the land [area] is limited,” said Burhanoglu, in response to Reuters’ questions. Burhanoglu did not give the name of the company likely to invest.
‘Taxes could reduce Turkey’s appeal’
Assessing changes to the proposed tax regulations, announced by the government last month and which could be passed by 2018, Burhanoglu pointed out that increasing the tax burden on the automotive sector would adversely affect market growth and stressed the risk of Turkey losing its appeal for foreign investors in the upcoming period. “The motor vehicle tax increase will not be applied this year, so demands will be backdated and have a positive effect,” he said. “Hopefully, next year will not be compensated by exports and will not fall back on production numbers. However, Turkey is loosing its image as a good automotive market in the eyes of investors. Investors initially look at the market size.” Burhanoglu added, “The pace of our growth with these taxes will be seriously slow.”
Burhanoglu said that because capacity limits in land areas have been reached, the TOSB wants to effect an amendment to existing regulations that would include existing basement floors in production. “The prices of the industrial parcels in some cities start at 500 euros per square meter. In an environment where land prices are this high, we can double our production areas by moving our subsidiary units and storage activities into basements if construction according to this is regulated,” he said.