Overview

Turkey’s young, sizeable population, dynamic entrepreneurial class, and advantageous geographic position as a bridge between Europe and Asia has made the country an important manufacturing and distribution hub. Turkey positions itself in the global value chain by leveraging lower labor costs and flexible production capabilities. Manufacturing’s share of GDP has increased to 18.83% in the last decade and Turkey aims to boost it to 21% by 2023 through its 2023 Industry and Technology Strategy.

Early adopters of advanced manufacturing in Turkey include the automotive and aviation industries, both dominated by major international companies with many local suppliers who must meet the latest standards and technological requirements. In addition, the consumer goods, electronics, chemicals, machinery, steel, construction, textiles, energy, and mining industries are focused on adopting advanced manufacturing technologies to remain competitive.

Currently, 36% of Turkey’s manufacturing exports consist of medium-tech products and 3% consist of high-tech products. Turkey aims to increase the former to 44% and the latter to nearly 6% by 2023. The GoT generally supports technology initiatives and major procurements, creating new opportunities for international technology companies. Over the next decade, Turkey is expected to invest between $1 to $1.5 billion, annually, to integrate industry 4.0 solutions (referring to the fourth industrial revolution and the digital transformation across manufacturing industries) into the manufacturing process. Further investment is needed to upgrade Turkey’s technological infrastructure, including funding for fixed and mobile broadband services, and fiber optics. Turkey’s path towards digitalization will also require prioritizing Science, Technology, Engineering and Math (STEM) skills in education. If Turkey fully adapts the industry 4.0 concept, it could save $10 billion a year in current manufacturing costs based on an estimated 4-7% increase in productivity.

In 2019, the Ministry of Science, Industry and Technology announced Turkey’s 2023 Industry and Technology Strategy detailing incentives for R&D and digital transformation of industrial enterprises. Turkey plans to invest heavily in over 300 product groups in the machinery, semiconductor, aerospace, defense, transportation technology, software, electronics, chemistry, and pharmaceutical industries. The Ministry will provide incentives for the development of new technologies involving artificial intelligence, 5G, big data and data analytics, IoT, blockchain, robotics and autonomy, UAV’s, biotechnology, nanotechnology, cybersecurity, additive manufacturing, quantum computing, ag-tech, and energy technologies. The GoT plans to establish Digital Transformation Centers piloting new technologies within organized industrial zones and technology development zones (Technoparks). MEXT, located in Istanbul, is Turkey’s largest digital transformation center, showcasing over thirty new technologies. Due to Turkey’s Customs Union with the European Union, Turkey has access to EU Horizon2020 Industry 4.0 funds. These funds provide $0.5-$2.5 million in support for private sector projects in various Industry 4.0 categories.

Leading Sub-Sectors

Innovative Materials / Technical Textiles

Innovative materials/technical textiles are used in sectors such as aviation, agriculture, construction and infrastructure, medical, energy, transportation, and marine and defense. Turkey’s total imports in this category (including composites) is around $2.58 billion. The market is expected to grow around 5% annually.

Additive Manufacturing

The automotive, aerospace and defense, household appliances, machinery, jewelry, and medical/dental industries began using additive manufacturing in Turkey in 2014. SMEs seek additive manufacturing primarily for the molding/sampling process and typically outsource this service. Turkey accounts for 1.3% of global additive manufacturing use as of 2021 with a market size of $336 million. Over 500 mostly polymer-based 3D printers are used in manufacturing. There is growing demand for advanced 3D printers and CAD and CAM programs, advanced printing materials (including biomaterials), and large-scale additive production capabilities. In 2022, Turkish Aerospace Industries acquired the world’s largest electron beam 3D printer, enabling it to print large sized titanium aerostructures.

Industrial Automation

According to the Industrial Automation Association (ENOSAD), the industrial automation market in Turkey was valued at $1.7 billion in 2021, with an annual growth rate of roughly 10%. The market is expected to reach $2.5 billion within the next five years. Collaborative robots, modular automation systems, and in-factory 5G networks are the latest industrial automation trends in 2021.

Many international companies present in Turkey also serve the  Eurasian, Middle Eastern, and North African markets, with an annual regional business volume of around $2.5 billion.

IoT / Big Data and Analytics

Some of the big data and analytics usages common in Turkey include:

• Supply chain and warehouse management processes: Real-time tracking of demand, order fulfillment, manufacturing flow, returns, etc.
• Production lines: Real-time control of performance, product durability, and safety
• Predictive maintenance: Real-time monitoring of industrial manufacturing devices allowing companies to predict when maintenance is required

In 2021, IoT sales in Turkey totaled $1.2 billion, up  20% compared to 2020. There are 7.4 million M2M subscriptions in Turkey.

Robotics

There are 16,500 operational industrial robots in Turkey, with about 40% in the automotive industry. According to 2021 statistics, countries with robotic capabilities in manufacturing use, on average, 80 robots per 10,000 workers. Turkey uses 32 robots per 10,000 workers, leaving significant potential growth opportunity. Robots in Turkey are most often used in the automotive industry, with over 230 robots per 10,000 workers (making it a top ten global market for robots used in the production of automobiles). Turkey is also a growing market for secondhand robots. Germany and the United States are the main sources of secondhand models.

Augmented and Virtual Reality

In the aviation, defense, automotive, electronics, durable goods, and textile industries, several large companies use AR and/or VR to select parts in their respective warehouses, transmit repair instructions over mobile devices, simulate products and production processes, and train workers. Further development of 5G networks will increase the markety for industrial AR and/or VR aplications.

Opportunities

According to the U.S. Department of Commerce’s International Trade Administration (ITA), Turkey ranks 16th for U.S. manufacturing technology exports, Companies with the greatest demand for advanced manufacturing technology solutions in Turkey include the automotive, aviation, defense, durable consumer goods, electronics, chemical, machinery, steel, construction, textile, food processing, energy, and mining industries.

For advanced manufacturing applications, there are emerging opportunities in product simulation and modeling, RPA technologies, advanced materials design, flexible production solutions, big data analytics and AI, enhanced cybersecurity, and predictive maintenance. In addition, there is a significant need for qualified solution partners and systems integrators in Turkey.

For further information on this section or for more on potential opportunities, contact:

Perim Akguner

Commercial Specialist

U.S. Commercial Service

Perim.Akguner@trade.gov