Analyses
21 sep 16

Some international companies may be hesitating when it comes to what needs to be or can be done in terms of fleet management in the near future in Turkey. We asked a number of local fleet about their top tips with regard to fleet management optimisation i

On 15 July, elements within the Turkish army staged a coup attempt that was quickly suppressed. The event sent a political shockwave through Turkey. But has it had an economic impact as well?
 
“To be honest, it was totally unexpected”, recalls Barbaros Citmaci, CEO Fleetcorp. He observes that the economy has lost some momentum in the time after the coup attempt. “And the financial sector, including Operational Leasing, will now be more careful about credit assessment”, he predicts.
 
Sign of strength
“Like other sectors, Operational Fleet Leasing was also affected by the event”, agrees Ilkay Ersoy, General Manager at DRD Filo Kiralama. But he points to the swift crushing of the coup by both government and people as a sign of strength – with positive repercussions for the Fleet sector: “Since August, we're experiencing an economic revival, especially in Operational Fleet Leasing. Increasingly consumers and companies see the advantages of leasing over buying”.
 
Turkay Oktay, President of Turkey’s Lease and Rental Association TOKKDER, and CEO of LeasePlan Turkey, sees mixed signals:
“The economic confidence index dropped 24.1% in August compared to July, but the consumer confidence index rose from 67% in July to 74.4% in August- a nine-month high”.
 
Rough weather
“We have had some rough weather, but the potential and the results are positive, so we are hopeful”, summarises Inan Ekici, of Otokoç Otomotiv and country manager for Avis/Budget and Zipcar.
 
Looking forward, will the political and economic impact of the coup and its aftermath have any specific consequences for the fleet and leasing industry in Turkey? Turkay Oktay thinks not: “Customers are waiting for a clear view of the near future. But we did not see any defleeting or cancellations. Demand from SMEs will continue, because leasing is a good solution for cost management, especially in times of uncertainty. We do see some deterioration of payment performance of our clients, though”.
 
Rising demand
“The coup attempt coincided with a soft landing of the Turkish economy, with GDP growth between 2% and 4%, well below the potential for 6% to 8%. We were expecting low-end double-digit growth in the Fleet market, with the extension of Operational Leasing compensating for fleet reductions”, says Barbaros Citmaci of Fleetcorp. And the overall prospect remains good: ”There are now almost 295,000 cars under management, 2.5 times as many as at the end of 2010. And the untapped market is still huge”.
 
A fact also noted by Ilkay Ersoy of DRD: “In recent years, the bigger cities like Istanbul, Izmir and Ankara have been the driving force behind the Fleet and Lease market. But we are now noticing a rise in demand for Operational Leasing from other cities elsewhere in the country, such as Adana, Antalya, Gaziantep, Konya and Samsun”.

Authored by: Céline Gilson