Credit boom and car sales

Whoever wins the elections on May 14, many factors such as the expectation of an increase in the value of the dollar, the fear of the subsequent rise in the exchange rate, the low interest rates in the face of inflation and the conversion of the car into an investment vehicle led to record levels. both in car sales and vehicle loans.

According to data from the Banking Supervision and Regulation Agency (BDDK), as of the week of April 28, vehicle loans increased 318.5 percent compared to the same week a year earlier and reached 73, 2 billion TL. Thus, an increase of TL 55.8 billion was achieved in one year.

Looking back to the beginning of the year, the growth rate for home loans is 13.8 percent in the 17 weeks since the first week of the year; While consumer loans were up 22.4 percent, vehicle loans rose 45 percent to TL 22.8 billion.

With the election approaching, the rise in auto loans has accelerated since the third week of March.

RECORD SALES EVERY MONTH SINCE JANUARY

A similar acceleration can be seen in auto sales and import data in this area.

According to the Association of Automotive and Mobility Dealers (ODMD), a new record in car sales has been reached every month since January.

Namely:

Turkey’s total car and light commercial vehicle market increased 33.5 percent in January compared to the same month a year earlier, reaching 50,894; Car sales reached the highest figure for January.

In February, the automobile and light commercial vehicle market increased 63.4 percent compared to February 2022 and reached 81,148 units, and this sales figure was recorded as the highest figure for February.

The high sales momentum in the automotive market continued in March and April.

While the number of automobile and light commercial vehicle sales topped 103,000 in March, it was the highest March sales number of previous years; In April it increased 62.7 percent compared to the previous year and reached 97 thousand 679 units, thus reaching a record number based on April.

Looking at total auto sales, it is noted that sales increased 55.7 percent to 252,819 units in the January-April 2023 period compared to the previous year, while the light commercial vehicle market increased by 62.7 percent to 80 thousand 831 units. .

THERE IS AN INCREASE OF 95.7 PERCENT IN IMPORTS

The reflection of this situation on imports is as follows:

According to foreign trade data from the Ministry of Commerce, imports of motor land vehicles, tractors, motorcycles and other land vehicles and their parts, spare parts and accessories, which increased by 77.6 percent annually in March 2023, increased by 95 percent on an annual basis as of April 2023. 7, increased to $2.4 billion.

In the period January-April 2023, it increased 76.7 percent compared to the same period of the previous year and reached 8.4 billion dollars.

‘CURRENCY DEMAND IMPLEMENTATIONS EXPLODE’

Assessing this situation to sozcu.com.tr, the Turkey manager of a global automotive brand said that high inflation and ongoing exchange rate volatility increased demand and they received record demands compared to previous years.

The source continued as follows:

“The expectation that there will be an increase in the value of the dollar, whoever wins after the elections, is valid not only for the reports of international organizations, but also for people on the street. So the idea that ‘I want to buy it anyway, I’ll buy it before it gets more expensive’ has created a significant increase in demand.”

DEMAND BY THOSE WHO HAVE LOW TAX RATES

A representative of the dealership, for his part, stated that the vehicles most in demand are those with a low tax rate.

This situation was also reflected in the data published by ODMD in the middle of the week.

In the market analysis part of the report, it was stated that 88.9 percent of the market consists of vehicles in segments A, B and C with low tax rates.