Production in Turkey's automotive industry increased from January through July this year but slowed last month, a sectoral report revealed on Monday, amid the global semiconductor shortage that has been hindering output.
The Automotive Manufacturers Association (OSD) said automakers manufactured 705,079 vehicles – including automobiles, light commercial vehicles, and tractors – in the first seven months, marking a nearly 11% rise year-on-year.
Automobile production rose by 2.1% year-on-year to 449,550 in the seven-month period, the data showed.
The overall auto sales market, including light trucks and other vehicles, grew by 31.4%, reaching 461,730 in the same period.
Coronavirus pandemic lockdowns caused a shift in consumer spending toward electronics and a spike in demand for the semiconductor chips that run them.
Modern automobiles can use dozens of chips in their various electronics systems, and carmakers have had to slow production or leave factories idle when they run out of supplies.
Many of the automakers were planning to rev up production this year to meet an expected surge in demand as the pandemic wanes and to recover from last year’s losses. But without enough chips, those hopes are fading.
Many of the Turkish top carmakers such as Ford Otosan, Tofaş and Oyak Renault had to temporarily pause their outputs in their factories in the past months.
Automakers have reduced the stocks of parts they keep on hand in recent years as part of cost-cutting measures, so delivery delays can quickly force an entire shutdown.
A report by the OSD also revealed that automotive industry exports jumped 26.8% on a dollar basis to $16.7 billion between January and July.
Climbing 6.6%, the sector’s export value reached $5.4 billion, the report added.
Turkey exported 512,320 vehicles, of which 322,874 were passenger cars, during these months. The capacity utilization rate in the sector was around 62% in January-July.
Yet this July, automotive production fell by 44.6% year-on-year, reaching 65,418, the data showed. Vehicle production was down nearly 57% to 33,529 units.
All this prompted a decline of 35.1% to 50,781 units, the report noted.