Page 76 - TURKRptJul19

extends the tax reductions for cars. The government last year decided to reduce the special consumption tax on vehicles to stimulate demand. However, the tax cuts, which expired as of July 1, has failed to produce the hoped-for results. The latest market data showed that auto sales (passenger cars and light commercial vehicles combined) plunged 16% y/y in June to less than 45,000 units. In the first half of the year, the local auto market contracted 45%. Moreover, the government’s tax revenues declined as a result of the reductions. Tax collection declined by 2.3% y/y in May with special tax revenues falling 3.4% on an annual basis. “The automotive industry is the engine of the Turkish economy. Thus, it is crucial to create an environment which ensures the continuity of investment in the sector,” said Haydar Yenigun, the head of the OSD. “We expect more support from the government,” he said. But he did not indicate what kind of support local carmakers demand from the authorities apart from the tax reductions.
Turkey's Vehicle Industry
(units)
May
y/y
Jan-May
y/y
P. Cars Production
96,345
1%
418,626
-11%
Total Production
136,517
-8%
625,946
-12%
P. Cars Sales
27,126
-52.6
120,354
-49%
Total Sales
33,979
-55%
156,990
-50%
P. Cars Imports
14,012
-63%
68,623
-56%
Total Imports
17,017
-63%
85,050
-56%
P. Cars Exports
80,233
4%
356,200
-9%
Total Exports
111,863
-4%
537,889
-7%
P. Cars Exports (USD mn)
995
-5%
4,892
-13%
Total Exports (USD mn)
2,824
0%
13,373
-6%
Tractor Production
2,046
-52%
8,982
-60%
Grand Total
138,563
-9%
634,928
-14%
source: osd
9.1.3 Transport sector news
Iran, Turkey to restart direct passenger train services. Iran and Turkey
76 TURKEY Country Report July 2019 www.intellinews.com