Ford official: Turkey's automotive sector to shrink by 35%

Special Report:Global Financial Crisis

ANKARA, Dec. 29 (Chinese media) -- A Ford Otosan official warns that Turkish automotive market would shrink by 35 percent in 2009 due to the negative effects of the ongoing global financial crisis, local newspaper Today's Zaman reported on Monday.

Ford Otosan executive board member Ali Ihsan Ilkbahar was quoted as saying that the European automotive market recently shrank by 35 percent and that the Turkish automotive sector would also experience a similar fate.

"Turkish automotive exports have been declining with every passing day," said Ilkbahar, adding that declining demand in both domestic and foreign markets would result in a regression of two years in terms of growth.

Automotive manufacturers in Turkey would have to cut production and that in 2009 production could decrease to 800,000 annually from the current 1.3 million, foresaw by Ilkbahar, adding that the sector would become the same size it was two years ago.

The automotive sector is currently the key element of Turkey's economy, with 23.6 billion U.S. dollars in exports in the first 11months of 2008. However, it is inevitable that this sector will also be hit by the destructive waves of the storm, said the report.

"The Turkish automotive sector sells 80 percent of its production to foreign countries, meaning that it is almost entirely integrated with global markets. Thus, any problem in global markets will directly affect the sector," Ilkbahar noted, emphasizing that the faster global markets recover, the more easily the sector will weather the storm.

Meanwhile, he predicted that global markets would recover only after the third quarter of 2009 and that it would take at least two years for a total recovery worldwide.