Mechanical Engineering remains one of the most important growth drivers in the Turkish economy. However, local manufacturers are still lagging behind in technologically sophisticated machines and systems. This offers new opportunities for German companies in particular.


For companies in the field of Mechanical Engineering, Turkey is a particularly interesting market for sales, but also for investments. Cheap operational costs like competitive labor costs, cost-effective and reliable energy, and logistical advantages due to Turkey's favorable geostrategic situation are making the market interesting for outsourcing. The development-promoting factors include a growing qualified workforce, an innovation-oriented infrastructure and a strong supplier base and help contribute to the attractiveness of the market. In Turkey, more than 450,000 engineers complete their studies every year. USD 600 million is spent every year on research and development in the industry, accounting for almost 10% of all R & D spending in Turkey.



Mechanical engineering plays a crucial role in the development of the wider industry of the Turkish manufacturing industry, mainly due to its ability to manufacture semi-finished products and intermediate consumption for other key sectors. That’s one of the main reasons why the Turkish government supports the industry and offers further incentives through subsidies and tax reductions. However, especially in the field of high-tech machines, Turkish suppliers are still far behind their competitors abroad. It is therefore no surprise that in the last decade, exports in the mechanical engineering sector reached an average annual growth of 10.3 percent. These Figures are showing a high domestic demand, and testify a high potential for investments now and in the future.


Industry 4.0 intensively discussed


A growing demand for machine tools in Turkey can be expected in the medium term. Turkish Companies must invest in expansion and modernization of their plants to adapt to the world market level. There is a growing awareness of the need for digital renewal in mechanical engineering. New applications like industry 4.0 are attracting lively interest and are being discussed intensively. This is primarily about the creation of prerequisites and the infrastructure for the digitization of production systems.


Since Germany continues to be a pioneer in this area and the two nations are already strongly linked in their history, the Turkish market is particularly interesting for German companies. These could make a valuable contribution in the framework of cooperative ventures and exploit long-term synergies. Despite the political climate in Turkey German companies should pay particular attention to the market and check whether a new investment or expansion in the Bosporus Country could be a successful option. 

GSC Team
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Date: 3/23/17