What is the Automotive Industry?

The term automotive industry refers to the sector that designs, develops, produces, and sells motor vehicles. As of 2007, more than 73 million motor vehicles have been produced worldwide. The automotive industry is considered the "engine of the economy" in all industrialized countries.

The Status of the Automotive Industry in Turkey and Worldwide

The automotive industry in the world and in Turkey is a continuously developing sector with increasing importance for national economies. Competition among companies in this sector is rapidly increasing. As a result, elements such as productivity increases, efficient use of resources, and administrative and technical organizations become significantly important. The automotive sector has shown significant developments in Turkey since the 1960s. In the 1990s, the sector gained a competitive nature focused on exports. By the end of the 1990s, leading automotive companies in the world had established firms in Turkey with Turkish partners, achieving a significant position with their facilities, some of which became export bases for the foreign automotive companies they partnered with. In the 2000s, it created higher added value and entered a “Sustainable Global Competition Process” for design and production aimed at the global market. The automotive sector will maintain its vital position for the Turkish economy both now and in the future.

The automotive sector is one of the sectors where the largest investments take place in the world. The leading countries in the global automotive sector are China, the USA, Japan, and Germany.

Leading Companies in the Automotive Sector

1. What Are the General Supports for the Automotive Sector?

There are various supports provided by KOSGEB, TÜBİTAK, and the Ministry of Trade for the automotive sector. These supports are categorized as either project-based or general supports. The details of the supports provided for the automotive sector are given below.

TÜBİTAK Project-Based Supports

A) TÜBİTAK 1501 - Industrial R&D Project Support Program
Within the scope of the 1501-Industrial R&D Support Program, projects conducted in areas such as producing a new product, improving and developing an existing product, raising product quality or standards, or developing new techniques or production technologies of a cost-reducing nature are supported under the framework of innovation definition. The support rate of the program is applied at 75%.

*There is no budget limit.
*Feasibility is required for investments over 5 million.

B) TÜBİTAK - 1507 - SME R&D Start-Up Support Program Call
The supports provided under the 1501 Industrial R&D Support Program aim to support the project-based research, technology development activities, and innovation activities of Small and Medium-Sized Enterprises (SMEs).

*Valid for projects up to 1,200,000 TL.

KOSGEB Project-Based Supports

A) KOSGEB Technology Investment Program
https://odsdanismanlik.com/tr/kosgeb-kobi-teknoyatirim-destek-programi/

B) KOSGEB International Market Program
https://odsdanismanlik.com/tr/kosgeb-yurt-disi-pazar-destek-programi/

C) KOSGEB R&D Product Development Program
https://odsdanismanlik.com/tr/kosgeb-arge-urge-ve-inovasyon-destek-programi/

KOSGEB General Supports

For detailed information; https://odsdanismanlik.com/tr/hibe-ve-destek-yonetimi-danismanligi/

What Sectors Does KOSGEB Support for the Automotive Sector?

Ministry of Trade Project-Based Supports

A) Global Supply Chain (GSC) Project
Support Amount: 15,000,000 TL
Support Rate: %50
Support Duration: 2 Years
Which Sectors Can the Global Supply Chain (GSC) Support Project Be Applied In?
• Mining and Metal
• Chemical products
• Automotive
• Machinery
• Space / Aviation
• Electrical / Electronics
Other sectors may also be considered if they meet the criteria.
What Expenses Will Be Supported Within The Scope of the Global Supply Chain (GSC)?
• Machinery, equipment
• Software acquisition
• Training, consultancy
• Certification, testing analysis, and product validation expenses
For detailed information; https://odsdanismanlik.com/tr/ticaret-bakanligi-kuresel-tedarik-zinciri-programi/

B) Design Product Development Project
Support Amount: 5,000,000 TL
Support Rate: %50
Support Duration: 3 Years
Which Sectors Can the Design Product Development Support Project Be Applied In?
• Design companies
• Design offices
• Cooperative organizations
• Firms engaged in commercial and industrial activities
What Expenses Will Be Supported Within the Scope of Design Product Development Support?
• Tool, equipment, material, and software
• Membership of website
• Personnel recruitment (designer, modelist, engineer)
For detailed information; https://odsdanismanlik.com/tr/tc-ticaret-bakanligi-tasarim-ve-urun-gelistirme-programi/

Ministry of Trade General Supports

• Support for Market Access Documents -4,000,000 TL (%50)
• International Market Research Support-100,000 TL per trip
• Support for Domestic and International Fair Participation (within the upper limit)
• International Promotion Support 4,000,000 TL %50
• International Trademark Registration Support 750,000 TL (%50)
• International Unit Support 2,000,000 TL (%50)
• Support for preparing a market entry project 200,000 TL (%50)
• Support for acquiring a brand belonging to a foreign company or a company established abroad 3,000,000 TL %50
For detailed information; https://odsdanismanlik.com/tr/hibe-ve-destek-yonetimi-danismanligi/

2. Investment Incentives for the Automotive Sector

Investments to be made related to the Automotive Sector are decided to be supported by the 5th region supports since they are among the priority investment issues. However, if these investments are within the 6th region, they are subject to the support conditions of that region.

*Investments of at least 300 million TL in the main industry of motor vehicles and investments of at least 75 million TL in motor installations and 20 million TL in motor parts, transmission organs/components, and automotive electronics are among the priority investment issues.

**Investments for manufacturing electric and hydrogen-powered vehicles of at least 50 million TL are also considered among the priority investment issues.

There are no special privileges for investments classified as priority investment issues if they are made in OSBs. However, if these investments are made in OSBs in the 5th region, tax reductions and employer premium share support will be provided at the rates and durations applied in the 6th region.

What is the Minimum Investment Capacity Required in Each Province to Benefit from Regional Investment Incentives in 2022?

As of 01.01.2022, investors applying for an investment incentive certificate must meet the above-mentioned minimum investment conditions to benefit from regional supports.

What Are the Investments in the Automotive Sector That Are Not Included in Priority Investment Issues?

*Investment topics that can benefit from the 4th region supports must be located in regions classified as medium-high technology industrial products according to the OECD technology intensity definition. If these investments are made in the 1st, 2nd, and 3rd regions, excluding Istanbul, they will benefit from the regional supports applied in the 4th region, and if made in the 4th, 5th, and 6th regions, they will benefit from the applicable regional supports there.

What Are the Minimum Investment Amounts Provided for the Automotive Sector?

o 3 million TL in the 1st and 2nd regions,
o 1,500,000 TL in the 3rd, 4th, 5th, and 6th regions.

How Can ODS Help You with Automotive Incentive Consulting?

In the context of the automotive industry, we have signed more than 150 successful consultancy projects in grant and support management, R&D and innovation project management, and investment incentive categories to date. In a sector that continuously develops and renews technologies, we provide production and quality consultancy to perfect production, management consultancy due to increasing volume, and export consultancy to market quality production globally. With our professional team and the services we provide, we create the most suitable benefit for your company.