Turkish Industrial Decline Forces Autoliv to Exit Production

The Turkish automotive sector is undergoing significant restructuring after the Swedish-based global leader in automotive safety, Autoliv, officially announced its decision to terminate production in Turkey. Operating in the country since 1993, the company’s withdrawal marks a critical turning point for the local manufacturing landscape. The move is expected to directly impact approximately 2,200 employees as operations are phased out through the first half of 2028.

Structural Shift in EMEA Manufacturing Strategy

According to official statements, the decision is part of a broader strategy to optimize production capacity within the EMEA region to align with future market demands. While the manufacturing of steering wheels, airbags, and seatbelts will be relocated to other international facilities, Autoliv intends to maintain its customer-facing commercial operations within Turkey.

The financial implications of this exit are substantial. The company estimates a total pre-tax charge of approximately $142 million, with $129 million dedicated to severance packages and employee retention costs. Magnus Jarlegren, President of Autoliv EMEA, emphasized that the transition would be handled with transparency and respect for the affected workforce during this difficult period.

Hakan Doğu: Turkish Industry is Losing Competitive Power

The news triggered a sharp warning from Hakan Doğu, former CEO of Renault Turkey, who described the situation as a historic decline. Doğu highlighted that Autoliv, which contributed $146 million in exports in 2023, was a cornerstone of the local supply chain.

“Turkish industry is losing blood in an unprecedented manner. We are no longer just losing competitiveness; we have simply become too expensive,” Doğu stated. He criticized the current economic climate, citing rising production costs and currency policies as primary drivers for the exodus of global giants.

The Broader Crisis in Automotive Manufacturing

This exit follows recent concerns regarding other major players, such as the Bosch Bursa plant. Industry experts point out that the global shift toward electric vehicles, combined with domestic inflationary pressures, is making it increasingly difficult for Turkey to maintain its status as a low-cost manufacturing hub. The departure of a high-tech safety provider like Autoliv signals that even high-value-added sectors are struggling to justify continued local production under current macroeconomic conditions.

source: karar