Auto production in Turkey increased by 20% y/y to 869,158 units in the first half of 2017, Kudret Onen, chairman of the Automotive Manufacturers’ Association (OSD) said on July 9.

OSD raised its auto output forecast for 2017 to 1.7mn units from a previous 1.65mn, Onen also said. Consequently, OSD’s annual auto output growth forecast for 2017 rose to 14% from the previous 11%. OSD also revised up its exports target from $27bn or 1.35mn units to $28bn or 1.4mn units. However, vehicle sales in June have declined for a fifth month in a row since February, data released on July 4 by the Automotive Distributors’ Association (ODD) shows. Across H1, sales declined 9% y/y, falling to 401,158 units.

Turkish auto industry has a combined annual production capacity of 1.9mn units.

Automakers’ passenger car production rose by 36% y/y to 601,586 units in January-June while total auto sales on the domestic market declined by 9% y/y to 410,609 due to tax hikes imposed in 2016 as well as local currency depreciation. Turkey’s auto exports rose 29% y/y to 714,824 in the first half.

In 2016, the country’s automotive output increased by 9% to 1.49mn units, with passenger car production rising 20% y/y. A total of 1.01mn vehicles were sold in the year - a figure that was almost unchanged from the previous year - while sales of passenger cars increased by 4% to 756,938 units.

Over H1, passenger car sales were down 10% y/y to 305,924 while LCV sales contracted 5% y/y to 95,234.

In April, Hayri Ece, secretary general of the ODD, said that the decline in Turkey's automotive sales was likely to deepen in the second quarter from the substantial fall in the first quarter due to foreign exchange impacts on prices.