Bad News for the Automotive Industry! Layoffs On The Agenda

early warning for automotive industry
early warning for automotive industry

TAYSAD shared the results of the Coronavirus Impact Study. According to the survey, as of June 1, the 'complete stance' trend in the supply industry has ended, as of June 21, 42 percent of members reported that they will return to normal working with social distances. In the survey, which also revealed that the production volumes in the supply industry will exceed 60 percent by June, the potential turnover and loss of employment especially attracted attention. According to the survey results, at least half of TAYSAD members lost more than 55 percent of turnover in April. One of both supply industrialists predicts a 25 percent turnover loss at the end of the year. Stating that the number of employees may decrease due to the job loss caused by the pandemic, the participants stated that by the end of the year, approximately 15 percent of blue collar employees; stated that there may be a 9 percent decrease in white collar employees.


TAYSAD President Alper hook, said the measures to be taken early, can provide significant advantages for the automotive sector in Turkey as would avoid the many negative scenarios. Giving examples of precautionary packages announced for the automotive industry in Europe, Kanca said, “Our latest survey reveals that all of our members started to reproduce and production volumes are gradually increasing as of June. However, the survey also gives urgent signals for the future of the automotive industry. As TAYSAD, we think that the tax arrangements that will activate the domestic market should be made as soon as possible and the sales of domestic vehicles through public banks should be supported. In addition, extending the Short Work Allowance process is among the other important supports that need to be explained. Otherwise, we can face losses, especially in terms of employment, as seen in the survey. ”

The Vehicle Vehicle Supply Manufacturers Association (TAYSAD), which has been holding the pulse of the automotive supplier industry with the surveys it has organized since the first moments of the New Type Coronavirus (Covid-19) epidemic, has shared the results of the Coronavirus Impact Study conducted for the fourth time. The survey, which was carried out with the participation of TAYSAD member companies, revealed important data regarding the return of the automotive industry to production, year-end expectations and possible problems. According to the survey, the 'complete stance' trend in the supply industry ends from 1 June. 59 percent of the members state that they will continue their partial working order until June 21, while the normal working order with social distances is expected to exceed 40 percent in June.

Turnover loss in the supply industry is over 25 percent

TAYSAD's survey also revealed that there will be an increase in the production volumes of partial working supply industrialists starting in June. According to this, the supply industrialists estimated that the production volumes, which were around 50 percent in May, would exceed the 60s by June.

The Covid-19 outbreak also significantly affected the industry's turnover loss and profitability rates. According to the survey results, one of both TAYSAD members stated that they had a turnover loss of more than 55 percent in April. Half of the supply industrialists surveyed predicted that they would lose more than 25 percent of turnover by the end of the year. On the other hand, while the participants calculated the decline of their profits before tax at the end of the year by 40 percent and above; 11 percent said they would hurt.

Employment loss may occur

In the fourth survey organized by TAYSAD, important data regarding the measures taken by the automotive supplier industry and the decrease in the number of employment due to these measures were also included. 91 percent of the supply industrialists surveyed stated that due to the effects caused by Covid-19, they focused primarily on reducing overhead expenses. Participants also listed the measures they will take during this period as reducing or completely stopping investments, lowering personnel costs, and receiving additional debt. The supply industrialists participating in the survey also stated that due to the loss of work caused by the pandemic, the number of employees could decrease, and by the end of the year, approximately 15 percent of blue-collar employees; stated that there may be a 9 percent decrease in white collar employees.

“Plans to support the automotive industry should be announced”

TAYSAD President Alper Kanca said, “I think our country has given a very successful examination in the Covid-19 process. The support, which was announced with the quick reactions of the government, was effective in terms of healing the pandemic wounds. In this process, the automotive sector also provided significant support to this health mobilization with both its main and supply industry. Now it is also necessary to focus on our economy. At this point, we accept Turkey's role as the leading sector of the automotive industry is very important. Just like in Europe, we believe that plans to support automotive should be prepared and implemented as soon as possible. The biggest export market of our country will take time to open up business in Europe. During this period, the revival of the domestic market is very important for the Turkish industry not to be damaged much. The fact that European countries find the procurement of products from the Far East risky and a strong domestic market can open the way for new automotive investments to come to our country after a long time. ”

“Employment loss may occur if necessary measures are not taken”

The automotive sector, measures to support the beginning of the domestic market and underlines the need to focus on domestic production Alper Hook, "Turkey in the ranking of global sales tool that ranks 2017th with 1 million units in 17, 2019 year, falling below the 500 thousand units 25 declined to order. In 2020, we know that the current situation will become even more risky. Therefore, urgent measures should be put in place to strengthen the position of our sector, which has begun to signal, compared to competing countries. As TAYSAD, we believe that possible negative scenarios will be prevented with some support that the government will implement early. In this context, we think that the tax arrangements that will mobilize the domestic market should be made as soon as possible and the sales of domestic vehicles through public banks should be supported. In addition, extending the Short Work Allowance process is among the other supports that need to be explained. Otherwise, as can be seen in the survey, we may face losses especially in terms of employment even though we do not want to. ”



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