German automaker Volkswagen has officially established a Turkey branch with 943.5 million liras ($164.7 million) at its disposal, staking out western Manisa province as the site of its next production center.
According to an announcement in the Trade Registry Gazette published Wednesday, Volkswagen made its final decision to establish an operation in Turkey, officially called Volkswagen Turkey Automotive Industry and Trade Inc.
The headquarters of the company is registered to the Yunusemre municipality of Manisa province.
The company plans to carry out a wide range of production processes at its new plant, particularly the design, manufacture and assembly of automobiles, trucks and other vehicles, as well as their parts and components. The sale, import and export of these products will also be carried out by the Turkey branch.
Reports of Volkswagen's plans in Turkey began to emerge after VW CEO Herbert Diess paid a visit to Turkey in June and met President Recep Tayyip Erdoğan.
At the beginning of this year, the automotive giant announced that it would build a new factory in Eastern Europe to manufacture the conventional engine (gasoline/diesel) versions of some of its major models, as it would produce electric vehicles in its German factories due to emission limitations in Europe. The German group also agreed with America's Ford to produce light commercial vehicles at Turkey's Ford Otosan plants.
Initially, there were five candidate countries for the new VW factory. The number eventually dropped to two, leaving only Turkey and Bulgaria on the table.
The German carmaker's new plant is expected to begin production in 2022.
Turkey has an automotive history that goes back almost 50 years. As one of the world's leading countries in the automotive sector, Turkey has received investments from many brands, including Fiat, Renault, Mercedes-Benz, MAN, Otokar, Isuzu, Honda, Hyundai, Toyota and Temsa, for the production of automobiles, light commercial vehicles, trucks, and buses. In addition to a solid infrastructure in the automotive supplier industry, Turkey also has a skilled workforce experienced in the sector.
Turkey has been striving to get Volkswagen, one of its best-selling brands, to make an investment in the country for 14 years. Ferit Şahenk, president of VW's Turkey distributor Doğuş Holding, first invited VW to invest in 2005 at the Geneva Motor Show. In the following years, this call was repeated many times by both Doğuş and Ankara.
