Renault Turkey May Look at Van Production, Venture Head Says

Renault SA (RNO), which makes seven models of passenger cars in Turkey, may look at building commercial vans at its plant in the country as competitors expand in the segment, the head of the company’s local joint venture said.

“There are good examples in Turkey for production of light commercial vehicles, such as Ford and Tofas,” said Tarik Tunalioglu, chief executive officer of the Oyak-Renault Otomobil Fabrikalari AS venture, said in an interview in Istanbul today. “So we may consider” producing vans.

Oyak-Renault, located in the northwestern Turkish town of Bursa, made 330,994 cars in 2011, accounting for more than half of Turkey’s car production last year. The venture plans this year to at least match its output of 2011, and to increase exports to 75 percent of production from 70 percent last year, Tunalioglu said today at a news conference.

Ford Motor Co. (F)’s Turkish division, Ford Otomotiv Sanayi AS (FROTO), and Fiat SpA (F)’s unit Tofas Turk Otomobil Fabrikasi AS (TOASO) make vans in Turkey in partnership with Koc Holding AS (KCHOL), the country’s largest conglomerate. Exports by the venture between Boulogne- Billancourt, France-based Renault and the Ankara-based Oyak Group army pension fund were valued at $3.2 billion in 2011, compared with $3.4 billion by Ford’s Turkish venture, Tunalioglu said.

Turkey’s industrywide car and van sales rose 14 percent last year to a record 864,439 vehicles, according to the Istanbul-based OSI Automotive Manufacturers’ Association website, with demand for light commercial vehicles expanding 8 percent and car deliveries increasing 16 percent. The market may shrink to 820,000 cars and vans this year because of a slowdown in economy and higher taxes discouraging sales, Tunalioglu said.

Renault’s Turkish production unit plans to raise investments this year to $254 million, including more than $100 million allocated for engine improvement, from $176 million in 2011, Tunalioglu said. It’s scheduled to start building Renault’s new Clio 4 sedan in June, he said.

To contact the reporter on this story: Ercan Ersoy in Istanbul at eersoy@bloomberg.net

To contact the editor responsible for this story: Benedikt Kammel at bkammel@bloomberg.net

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