The machinery sector, which constantly develops and changes with the historical development of humanity, forms the main lines of production and is of critical importance. The machinery industry in Türkiye, whose history spans more than a century, has gone through many development stages throughout this long adventure. Having made significant developments in the last century, the Turkish machinery industry, which was previously an importer, has now become an exporter and one of the important players in the global industry.
The rapid growth and development experienced in the field of industry from past to present has also paved the way for mechanization and the development of machines. Although industrial and technological developments vary depending on the development level of countries in the world, developments related to machinery are rapidly spreading to the industrial sector all over the world from the very first moment.
Private sector investments in the machinery sector in Türkiye accelerated in the 90s. In the Turkish machinery sector, which accelerated with private sector investments in the 90s, today there are approximately 120 large-scale companies that can make up to 40 percent of total exports. When Machinery Exporters’ Association (Turkish Machinery) was established in 2001, machinery exports were 1.7 billion dollars, but today the sector is bound to reach 30 billion dollars in exports.
Wide range of machinery production
According to the Machinery Sector Sustainability Action Plan Report prepared by Turkish Machinery in 2023; The machinery sector in Türkiye has become an important branch of the economy and industry with the employment it creates and high export performance. The sector, consisting of small and medium-sized enterprises, operates in 23 sub-branches. Having a wide range in machine production offers a significant advantage to the sector. Thanks to the richness of the machinery production portfolio, the export performance of the sector in the last 10 years is in an admirable position compared to other sectors and rival country comparisons. The companies in the sector, especially their export performance and their proven quality, flexible and competitive structure in international markets, are at the center of attention of international customers. Being in the circular economy system with its consumer/producer structure and other manufacturing industry branches increases its responsibility in social, economic and governance dimensions in the national, regional and global arena. On the other hand, since it is the sector that makes or will make new investments aimed at protecting the increasingly important environment and nature, applying bridge technologies during the transition period of the change and transformation process is among the responsibilities of the sector. In accordance with this responsibility, Türkiye’s machinery manufacturers will continue to be an example and pioneer in this process by increasing resource and energy efficiency and producing environmentally friendly machines and technologies in the perspective of sustainability.
The sector successfully competes with its rivals by diversifying its product range
The machinery industry in Türkiye, whose history spans more than a century, has gone through many development stages throughout this long adventure. The machinery industry, which has made significant progress in the last century, has moved from importing to manufacturing. Türkiye’s strategic geographical location at the intersection of Europe and Asia, combined with its qualified workforce, contributed to the growth of the machinery industry. Over the years, Turkish machinery manufacturers have focused on modernizing their production processes and adopting advanced technologies. The sector has diversified its product range to include industrial machinery, construction equipment, textile machinery and more and has entered into successful competition with its rivals. In the Turkish machinery industry, whose machinery and equipment investments have been growing continuously for 14 quarters, most sub-sectors, especially air conditioning devices, work and construction machinery, agricultural machinery, textile machinery, pumps and compressors are progressing in an upward trend.
More than 60 percent of exports are to the USA and EU countries
The Turkish machinery sector, with its developed infrastructure and rich human resources, is the 6th manufacturer with the highest domestic value added rate in machinery exports among 36 OECD member countries. Türkiye earned its place in this list, right after Germany with a rate of approximately 77 percent, thanks to its strength in the field of R&D. Like all sectors, the Turkish manufacturing industry, which exports more than 60 percent to the USA and EU countries and has a respected position in the world machinery trade with its high-tech products, is extremely affected by the twin transformation processes.
R&D is intertwined with the machinery manufacturing sector
Since it provides input to almost the entire manufacturing industry, the machinery manufacturing industry is a driving force for other sectors. In other words, the development of machinery manufacturing enables the development of other manufacturing industries. The machinery manufacturing sector manufactures machines, parts and tools that produce a wide range of goods and services for other sectors of the industry, thanks to the inputs it provides from within the manufacturing industry, and also assumes a priority and privileged function by presenting the products produced by these machines to consumers on a global scale. In the machinery manufacturing sector, which requires project, R&D and engineering designs to be made at every stage, machines, machine parts and tools go through the design and project phase, are re-planned and put into production according to the request of the demander and the diversity and functions of other products. Again, tools and apparatus are changed and reproduced according to user requests. Since R&D studies play an important role in the development of the sector, R&D is intertwined with the machinery manufacturing sector.
Number of design award-winning Turkish companies are on the rise
The machinery sector, as the sector with the most R&D c28 billion dollars of machinery exports in 2023xfacturing industry. One of the main reasons for the rapid increase in resources allocated to R&D is the increase in the number and quality of employment due to the diversification of machines and deepening of knowledge. While the share of the machinery sector in general manufacturing industry employment is 9.4 percent, its share among R&D employees is approaching 14 percent, which is a requirement of global competitiveness. Thanks to the ever-increasing culture of innovation, Turkish machinery manufacturers are increasing the number of design award-winning companies that not only follow trends but can also lead in niche areas. Thanks to its strength in the field of R&D, it alone realizes approximately 25 percent of the domestic patent and utility model applications in the manufacturing industry. According to the data created by the Turkish Machinery Federation (MAKFED) based on the Turkish Statistical Institute (TUIK); More than 50 thousand enterprises in the machinery sector manufacture machines and provide their maintenance and service, with over 440 thousand direct employment.
28 billion dollars of machinery exports in 2023
According to the consolidated data of the machinery manufacturing industry announced by the Machinery Exporters’ Association (MAİB); The machinery sector increased its exports, including free zones, by 11 percent compared to the previous year, reaching 28.1 billion dollars by the end of 2023. Exports to Germany, whose machinery imports remained flat throughout the year, increased by 7.5 percent to 3.2 billion dollars; On the other hand, the income from Russia, the second country with the most exports, increased by 68.3 percent and approached 3 billion dollars. There was a 10 percent increase in our exports to the USA, which is the third country. A total of 1.7 billion dollars of machinery exports were made to the USA throughout 2023. Italy, the United Kingdom, France, Spain, Poland, Iraq and Romania were the other countries to which machinery was exported throughout the year. While the highest increase in our top 10 markets was experienced in Russia, there was a decline only in France among the top 10 countries. The share of machinery in general exports to Germany increased to 17.2 percent. In 2022, this rate was 15.6 percent. While the share of machinery in general exports to the USA was 13.8 percent, this rate was 23.6 percent in Russia. Export increases of up to 10 percent were achieved in the USA, Italy and the United Kingdom, where machinery exports exceeded 1 billion dollars. The three most exported product groups were domestic and industrial refrigeration machines, internal combustion engines and their parts, and construction and mining machines, while exports of machine tools increased by 15.3 percent, reaching 1.5 billion dollars. In 2023, the industry’s average export price per KG increased from 6.2 dollars to 7.2 dollars. In the top 10 markets, the country with the highest unit price was the USA with 13.2 dollars, and the lowest was the United Kingdom with 4.7 dollars.
“The target is 30 billion dollars of machinery exports in 2024”
Kutlu Karavelioğlu, President of the Machinery Exporters’ Association, pointed out that the machinery manufacturers in Türkiye differentiated positively from competing countries throughout the year and said: “In the first three quarters of 2023, when the machinery and equipment industry production in the world decreased by nearly 1 percent and machinery and equipment investments decreased by 2.5 percent. In Türkiye, the same data showed an increase of 9.4 percent and 11.5 percent, respectively. Türkiye’s machinery manufacturers closed the year, in which world goods exports were estimated to have contracted by 5 percent and machinery exports by 1 percent, by bringing our country’s share in global exports close to 1.2 percent. In our plans for the new year, for which we have set an export target of 30 billion dollars, we are encouraged by the statements of the most authoritative voices, especially our President, our Ministers of Commerce, Industry and Technology, who make visible the capabilities and success of our machinery and other sectors with high added value.” Underlining that according to TradeMap data, among the 30 countries that purchased the most machinery from abroad as of the third quarter, Türkiye was the one whose imports increased the most with 23 percent, Karavelioğlu said: “Türkiye 2023, compared to 2019 before the pandemic, increased its machinery and equipment investment by 70 percent, and machinery in terms of tonnage.” It closed by becoming a country that increased its production by 66 percent and its machinery export revenue by 43 percent. “While this performance data, which is nearly 5 times the world average, makes us the shining star of the global industry, our machinery imports have increased by 85 percent, reaching 45 billion dollars.”
