Deutsche Bank Among German Firms Hit by Deepening Turkey RowBy , , and
VW, Daimler, Siemens, Hugo Boss employ thousands in country
German exporters’ lobby says threat to business is ‘real’
A German government warning to companies against doing business with Turkey has put some of the country’s biggest firms on notice.
Deutsche Bank AG, Siemens AG and Volkswagen AG are among the German companies with deep roots in Turkey that date back many decades. German manufacturers also have numerous factories in the country that employ thousands of workers, leaving them vulnerable to the deterioration in diplomatic relations that has intensified in recent days.
Germany on Friday dismissed a list of 678 “items and accusations” from Turkey involving German companies as “not concrete,” declining to investigate further. The deepening dispute -- with Foreign Minister Sigmar Gabriel announcing a “re-orientation” of policy toward Turkey -- prompted a lobby of German exporters to say the threat to business was “real.” The two countries’ trading ties were worth more than $36 billion last year, with more than 6,800 German firms currently operating in Turkey.
Here are some of the German companies with the most exposure:
Deutsche Bank AG
Germany’s biggest lender entered Turkey in 1987 and has operations that include corporate finance and trading. Deutsche Bank Turkey has one branch, employing 116 people. The financial firm last month scaled back some derivatives activities in the country.
The lender in January rejected claims by a pro-government newspaper that it was plotting to undermine the economy, and said it was “unacceptable” for its name to be associated with terrorism, after the daily Yeni Safak said Deutsche Bank and other German institutions were attempting “economic terror.”
The German automaker counts Turkey as one of its key markets, where VW delivered roughly 174,000 vehicles last year, up 5.6 percent, and on par with the likes of Russia and Italy.
VW’s MAN heavy truck brand has a facility near Ankara, which was the commercial vehicle maker’s first production site outside Germany when it began operations in 1966. It’s currently MAN’s largest bus plant, according to the company’s website. The factory produces city buses and coaches for the MAN and Neoplan brands.
The industrial company has about 3,000 employees in Turkey and investments ranging from factories to hospitals. Siemens runs laboratories in Turkish medical clinics. The company aims to generate 100 million euros ($116 million) in annual revenue from the ventures within the next five years.
Hugo Boss AG
The German fashion company’s largest plant is located in Turkey, with 3,777 employees. The main focus at the factory in Izmir is manufacturing high-quality apparel such as suits, jackets and shirts as well as tailored womenswear. The company says it’s “watching closely” developments in Turkey and taking all matters “very seriously.”
Mercedes-Benz has been producing trucks in Turkey for more than 30 years, which it sells primarily on the domestic market. It’s investing 113 million euros through 2018 in the Aksaray plant to double capacity, where the company currently employs about 1,800 workers. Daimler also produces buses on the outskirts of Istanbul, most of which are exported. That plant employs some 3,300 people.
Axel Springer SE
The media company, which owns 7 percent in Turkish broadcaster Dogan TV Holding, has said it won’t make new investments in Turkey because of the country’s crackdown on journalists. Chief Executive Officer Mathias Doepfner has harshly criticized the Turkish government for jailing a reporter who works for Axel Springer’s newspaper Die Welt.
After a German comedian ridiculed Turkish President Recep Tayyip Erdogan in a poem on German TV, Doepfner published an open letter in Die Welt supporting the performer and daring Erdogan to sue.
Europe’s biggest insurer acquired Yapi Kredi Sigorta AS for 684 million euros in 2013 to expand in the country. Last year, Allianz had 1.7 billion euros in property and casualty premiums from Turkey, 3.2 percent of its global total, and 968 million euros in life insurance premiums, or 1.5 percent of its life insurance business.
Germany’s biggest renewables producer holds a 50 percent stake in Enerjisa Enerji AS, a venture with Haci Omer Sabanci Holding AS. The partnership reported sales of 3.39 billion euros in 2016 and is looking at an initial public offering of its downstream business later this year. Enerjisa has nine million customers, more than EON has in any other country.
Robert Bosch GmbH
The world’s biggest auto-parts supplier has five different companies in the country, located in Istanbul, Bursa, Kocaeli, Manisa, and Tekirdag. The units operate in the areas of mobility solutions, energy and building technology, industrial technology and consumer goods. Bosch started operations in Turkey with a branch office established in 1910. Its first factory opened in Bursa in 1972. Bosch Turkey employs around 16,500 workers.
The German airport operator owns a 51 percent stake in Antalya airport, Turkey’s third-largest. A drop in travelers to Antalya last year resulted in the airport swinging to a net loss of 32.2 million euros.
Deutsche Lufthansa AG
The German airline has a 50-50 joint venture with Turkish Airlines called SunExpress, a leisure carrier with 72 aircraft and more than 3,800 staff. SunExpress carried more than 8 million passengers last year and generated 991 million euros in revenue. Lufthansa also uses crews from SunExpress to staff its long-haul services under the Eurowings brand.
The German defense company in 2016 established an Ankara-based joint venture with Turkey’s BMC Automotive and Etika Strategi of Malaysia. The partnership plans to make tanks at the facility once it’s up and running.
The chemicals company has about 800 employees in Turkey spread over seven offices and six production sites.
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The health-care company has two plants in Turkey for its crop science and consumer health units, and employs about 1,400 people in the country.
Fresenius Medical Care AG
The German business has two production sites in Turkey, including an 800-employee site in Antalya that makes kidney dialysis equipment and a smaller location near Ankara. The company’s Turkish subsidiary had $67.4 million in product sales in Turkey last year.
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— With assistance by Tara Patel, Tino Andresen, Naomi Kresge, Oliver Suess, Stefan Nicola, Benjamin Harvey, Chris Reiter, Oliver Sachgau, and Patrick Donahue