Turkish car sales forecast to grow 20 pct in 2004 thanks to strong lira
ISTANBUL – Turkish car sales are expected to grow at least 20 percent in 2004 after rebounding strongly this year, as greater political and economic stability triggered a fall in interest rates, analysts said. Sector demand had been restrained since 2000 because of two financial crises, which sent unit sales sliding to less than 91,000 last year from 131,000 in 2001 and more than 466,000 in 2000. Sales are expected to reach some 210,000 units this year, a senior industry official said. In the first 11 months of the year, sales surged 138 percent to 175,576 vehicles. Domestic car sales jumped 96 percent and foreign car sales rocketed 167 percent. The lira’s appreciation against the dollar by more than 15 percent this year has helped fuel foreign car sales, which now constitute a record 67 percent of total sales. «We estimate that there will be growth of 20 percent in 2004 in the market as a whole,» the industry official told Reuters. The rise in sales this year reflects a fall in inflation and interest rates, which led to cheaper consumer credit. A report by the Automotive Industry Association said 74 percent of all cars sold in the third quarter were bought on credit, up from 54 percent in the same period last year. Wholesale price inflation, at 16.2 percent in November, is targeted to fall to 12 percent next year. Consumer credit rates, at about 4.0-4.5 percent monthly last year, fell to about 2.0 percent this year and are expected to decline further in 2004. «With the continuing fall in interest rates, we estimate that domestic car sales will rise at least 20-25 percent,» said TSKB bank analyst Cemal Demirtas. «For that growth to increase (further) next year, purchasing power must grow. We expect that will take some time – 2004 will provide a test for purchasing power,» Demirtas said. The senior sector official said production next year would jump by around 25 percent to 660,000 units. A Reuters poll showed domestic car maker Tofas was expected to achieve a 26.6 percent increase in net sales this year to 1,930 trillion lira ($1.35 billion).
