Home / Economy / How Turkey’s local car adventure made a Chinese car company one of world’s leading electric car makers

How Turkey’s local car adventure made a Chinese car company one of world’s leading electric car makers

Ilhan Tanir

Hakan Karaaytu

Edited by WHatti Staff

Interesting developments related to the domestic automotive industry have been revealed at TUBITAK, Turkey’s state scientific council, during the country’s latest election periods. The promise of Turkish-produced automobiles has been a near-constant feature of the ruling party’s agenda in recent years.

The “automotive” agenda, first introduced by the current Deputy PM Fikri Işık’s declarations in 2015, has been a notable part of the AKP’s electoral campaigning in every election period since. During these periods excitement was built up around the subject through demonstrations, interviews, and even displays of “prototype cars”, and ultimately Turkey announced that it would complete preparations to produce domestic cars, paving the way for ‘cheap’ automobiles to become the pride of the party’s voters once the elections were over.

Meanwhile, it was implied that those who cast doubt on the project’s chances were themselves somehow less than “local”, or even the puppets of foreigners.

Rather than an internal combustion engine, Işık vowed that Turkey would produce electric cars and that “Turkish brands will be on their way before 2020”. The first production was promised in early 2016, with Işık even promising in front of the press that 30-40 cars would be completed in that year.

However, after Işık’s statement that TUBITAK had produced a Turkish prototype, experts discovered that the prototypes that the minister referred to were actually an iteration of Saab’s 9-3 models that was implicated in that company’s bankruptcy.

Minister Isik explained that ‘camouflaged’ cars are Saab

Rather than producing Turkey’s own car, Işık said, they had instead made an agreement with an automotive brand and had chosen to purchase complete rights for the entire production line of the car to belong to Turkey. This, he said, was an achievement of such importance that it meant ‘they did not need to rediscover America again’.

But after the news regarding the Saab models came out, Işık was forced to make another statement about the domestic automobile, saying “we bought the intellectual property rights of the Saab 9-3, not just the name.”

In the same conversation, Işık said that there are two paths to producing the domestic automobile; with the first requiring Turkey to design and produce its own prototype. According to Isik, such a study would take 3-5 years and cost $1 billion, and thus by working with Saab’s model, Turkey had taken a shortcut towards the goal of domestic car production.

Işık also mentioned the name of the automotive company that Turkey had worked with the first time: ”It is the elongated electric vehicle with a range of fields that Turkey really wants to progress. This will be a platform for this and we are starting to develop this platform. TUBITAK will have an important leadership here, but we will continue to cooperate with NEVS, which developed the Saab 9-3 that we bought. ”

NEVS Company or Saab?

The Saab company that Işık refers to had at that point become a Chinese factory. Saab was transformed by the Chinese “National Modern Energy Holdings Ltd.” into a company founded in 2012 under the name “National Electric Vehicle of Sweden” (NEVS) when the Chinese company acquired all the rights to the factory and its equipment, testing and laboratory facilities. While the founder of the company is Chinese, all the head management is Swedish.

The Chinese company also declares a partnership

The Chinese NEVS company seems to have made a statement on its site one day after Minister Işık announced his partnership with Saab. In the statement made on 16 October 2015, the Chinese company declared its partnership with Turkey for the first time.

The bankrupt company suddenly ascends.. With Turkey’s money..

The date on which NEVS, which had bought a failing company stricken with debt, managed to pay off all of its debts, fell on 09.09.2015, just a month before the first domestic automotive disclosure.

The Chinese bankrupt company suddenly pays off its debts  .. with Tübitak’s money ..

You did not hear it wrong: On September 9, 2015, a month before the date on which Işık announced a partnership with the Chinese company, the NEVS company announced that it was paying all of its debts to its creditors. It is very likely that the Chinese company paid these debts with the money that TUBITAK had paid it. The later history of the company shows a rise beginning in June 2015.

A bankrupt Chinese factory established .. with money from the Turkish ‘domestic automobile’ dream project ..

Meanwhile, the Hürriyet newspaper reported that on October 21, 2015, the Chinese would build a factory with the money from Turkey’s “national automobile” project. This story broke during the electoral period between June 7 and November 1, when courageous journalism was still possible in Hürriyet. The following details are from the Hurriyet story:

40 million euros, which Turkey paid for domestic car production in the first place, became the savior of the Chinese NEVS in its wrecked state. The company announced in a press release in September that it had paid all debts and that there would be no trouble with creditors. The NEVS company also announced that it would be able to carry on without production of any Saab cars, and that it would be involved in the production of China’s electric national car by laying the foundation of a factory which will produce these cars in collaboration with the NV company. 

The company then established partnerships with various Chinese companies and received orders. This led to the establishment of a factory with a capacity to produce 200,000 vehicles per year.

In January of 2017, NEVS, which received a license to produce cars in China, is receiving an additional 100,000 additional orders, on top of the existing order for 150,000 vehicles.

According to an expert source who spoke to the Washington Hatti but wishes to remain anonymous, we look at the numbers of electric vehicle production in 2016; the largest manufacturer was the BYD company with 100,183 units, followed by the TESLA firm with 76.243. Therefore, the NEVS Company, which has paid its debts with TUBITAK’s funds, is set to become a rising star in the electric car sector, with extremely favourable figures according to its sector.

Number of electric cars to be made

And the Chinese company makes the ‘real’ prototype last month. Turkey has no name about this project.

Last week NEVS Company introduced electric vehicle. The company plans to receive an additional 100,000 orders after delivering orders of 150,000 units.

Mikeal Ostlund, communications director of NEVS, who does not disclose the fee given by TUBITAK because the agreement between Turkey and NEVS includes a confidentiality stipulation, has explained that the development of Turkey’s first domestic car should take about 3 years.

“All test cars and prototypes, as well as the rest of the pre-production phase, will be completed by us [outside Turkey]. Then, we will produce the vehicles in Turkey once the factory is established and the production is ready. NEVS will continue to support the industrial partnership with its know-how, which will produce the domestic automobile in Turkey. But the company that will produce the vehicle in Turkey will not be NEVS. ”

Meanwhile, Turkey’s current Science Minister Özlü said this on August 15th: ”We will do a second round talks for local cars.” Özlü does not mention about Işık’s former project. No more NEVS, no more talk about the investment. It sounds like new Turkish minister begins from the scratch.

The expert’s comment is:

In the end, TUBITAK has funded a Chinese company that could go on to lead the Electric Vehicle Industry. And what is left to us is barely enough information on the [domestic automobile production] platform to fit on a flash disk, meaning we will never be able to bring the project to life.

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One comment

  1. Ergun KIRLIKOVALI

    “…It is very likely that the Chinese company paid these debts with the money that TUBITAK had paid it…” Likely? So you are not sure? You base a whole article on likelihood and make a firm “prediction”? It is “likely’ that I wasted my time reading your fortune-telling, long-winded story based on “anonymous” sources… re-write this story when you “know” the facts…

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