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PREFACE

Machine Tools are “Basic Investment and Production” machines used to produce high value-added technologies in all sectors of manufactured goods and manufacturing industry, especially critical industries such as automotive, defense, aviation and medical. Machine Tools sector has a highly strategic significance for the growth process of countries, and creates a multiplier effect on economic growth by determining the productive skills of the sectors that it provides input for the fundamental manufacturing machinery. The structure of the sector and its developments are considered to be an important indicator of national economy.

Since 1992, Machine Tools Industrialists and Businessmen Association of Turkey (TIAD) has been working in order to create added value for the country. Additionally, the Association is convinced that making an assessment of current situation of the sector as well as communicating the developments to relevant communities will make a contribution to Turkey’s economy.

Prepared in order to achieve this specified goal, this report features economic developments of 2016 on Turkish Machine Tools Industry. The data used in the report is obtained from the Turkish Statistical Institute (TUIK).In the report, domestic market situation of the import and export data of machine tools for metal working had been analyzed for the years 2015 and 2016. Since it is only machine tools for metal working that had been analyzed, some of the HS Codes were excluded.

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MACHINE TOOLS INDUSTRIALISTS AND BUSINESSMEN ASSOCIATION OF TURKEY (TIAD)

Machine Tools Industrialists and Businessmen Association (TIAD) of Turkey is a professional organization established in 1992 with the aim of gathering industrialists and businessmen dealing with imports, exports, manufacturing, wholesale and/or retail trade of machine tools, their complementary accessories and tooling equipment which are among the fundamental means of the manufacturing processes. The mission of the Association is to represent its members in the best way on all national and international platforms.

By February 2017, the number of TIAD members has reached to 190 and more than 80% of the machine tools demand in Turkey is met by TIAD members.

TIAD became a member of the European Trade Association for Machine Tools, Tooling and Technologies (CELIMO) as of 2000. Having presided over CELIMO in the 2006-2008 period, TIAD still holds Board Member status in this international association. CELIMO currently represents 1.200 machine tool distributor companies holding more than 10 billion Euro total capital, and it constitutes a fundamental market for Turkey’s exporters.

TIAD performs activities both for the benefit of the country and its members. These activities are carried out through Committees and Working Groups constituted within its corporate structure. In this framework, TIAD has Fair, Laws and Regulations, Media and Advertising, Membership Development and Coordination, Training, After Sales Services Committees, as well as “Working Groups” of Tooling, Metrology, CAD / CAM, Metal Forming Machine and Metal Cutting Machine.

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REPRESENTATION ACTIVITIES

TIAD’s major representation activities include:

National Area;

• Union of Chambers and Commodity Exchanges of Turkey (TOBB) Machine and Equipment Manufacturing Sector Assembly,

• Machinery Technical Committee (MAKTEK) established and working under Turkish Ministry of Science, Industry and Technology,

• MAKTEK Machine Tools Sub-committee,

International Area;

• Board Member of European Association for Machine Tools, Tooling and Technologies (CELIMO).

OUR COOPERATING ASSOCIATIONS

SPAIN

ITALY

JAPAN

South Korea

South Korea

United Kingdom

Taiwan

Taiwan

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TIAD ORGANISATIONAL SERVICES ENTERPRISE

TIAD leads organization of comprehensive machine tool fairs in Turkey.

Within the scope of this effort;

• MAKTEK EURASIA - Machine Tools, Metal Processing Machines, Welding, Cutting, Drilling Technologies, Quality Control & Test Equipment Fair

• MAKTEK IZMIR - Machine Tools, Metal Processing Machines, Welding, Cutting, Drilling Technologies, Quality Control & Test Equipment Fair

• BURSA METAL WORKING – International Metal Processing Machines, Welding, Cutting, Drilling Technologies, Hand Tools, Pneumatic & Hydraulic Fair

• KONYA METAL WORKING - International Metal Processing Machines, Welding, Cutting, Drilling Technologies, Hand Tools, Pneumatic & Hydraulic Fair

• QUALITY - Control, Metrology, Testing Equipment and Industrial Software Fair fairs are supported by our Association.International Fair Organizations

TIAD keeps tabs on international fairs concerning the sector and communicates all the machine tool fairs across the world as a list to its members through bulletins and its website. TIAD also arranges travelling and accommodation organizations to help its members visit important fairs with affordable conditions.Moreover, TIAD also participates international fairs individually as an association to promote its member companies and the sector.

TIAD PRESS AND PUBLICITY SERVICES ENTERPRISE

Through the channel of its bimonthly TT Magazin (Machine Tools and Manufacturing Technologies Magazine), TIAD keeps its members and machine tool users up-to-date with the latest technical and technological developments in national and global markets. Since 2004, TT Magazin held its readability at the highest level with its quality informative content, while offering a great opportunity to its advertiser companies to find their target audiences through accurate and affective distribution. It is printed and distributed 4.000 hardcopies.

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TIAD TRAINING AND CONSULTANCY SERVICES ENTERPRISE

TIAD ACADEMY contributes to the progress and development of Turkey by providing the correct, efficient and effective use of “Machine Tools”, described as “the main tools to produce manufacturing machinery” which are essential in various manufacturing industries, especially in aerospace, aircraft, defense, white goods, automotive, ship construction, machinery, casting, construction, textiles, food and furniture sectors. Within TIAD Academy, training programs are developed and applied to realize the target of producing intermediate goods used in most manufacturing sectors with less cost and producing more value added products and exporting them to the whole world.

Our Trainings• CNC Lathe Operatorship ve Programming • CNC Machining Centre Operatorship ve Programming• Computer Aided Design (CAD) • Computer Aided Manufacturing (CAM)

TIAD VOCATIONAL TEST CENTER ENTERPRISE

In March 2011, TIAD was granted by the European Union (EU), with the approval of and through the Turkish Central Finance and Contracts Unit under the “VOC-Test Center Grant Scheme”. In the course of the “Developing and Operating Machine Tools VOC-Test Center” project,

TIAD established the occupational standards and vocational qualifications for • NC/CNC Machine Tools Mechanical Service Responsible, • NC/CNC Machine Tools Electric/Electronic Service Responsible • NC/CNC Machine Tools Application Responsible

in line with European Qualifications Framework (EQF). TIAD MTM, having ISO 9001 and IS0 17024 Standards, makes both theoretical and implementation tests to the candidates before issuing the certificates. These certificates will also be recognized by the EU Member States in the future.

In accordance with this standard and qualifications, the “Vocational Qualification Assessment and Examination System” is established and began to be implemented. TIAD Vocational Test Center (TIAD MTM) got accreditation from TURKAK (Turkish Accreditation Agency) in December 12th, 2013 and authorization from MYK (Vocational Qualification Authority) in July 1st, 2014.

TIAD has been granted with a fund by European Union (EU) for the qualification exams under the “National Vocational Qualification System Development and Implementation of Turkey Qualifications Framework EU Project” and signed a protocol.

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GROWTH RATE (2010-2015)

INFLATION (2010 – 2016)

UNEMPLOYMENT (2010 – 2016 October)

GENERAL INFORMATION ABOUT TURKEY

Producer Price Rate

Unemployment Rate

Consumer Price Rate

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AVERAGE EXCHANGE RATES (2010 – 2016)

TURKEY’S FOREIGN TRADE (2010 – 2016)

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COMPARISON OF FOREIGN TRADE DATA FOR MACHINE TOOLS

8456: Machine tools for precessing materials through abrasion with laser, photon, ultrasonic and other waves etc.as well as “Working Groups” of Tooling, Metrology, CAD / CAM, Metal Forming Machine and Metal Cutting Machine.

In 2016, the import of machine tools in group 8456 was realized as USD 90.646.106. This meant a 3,42% increase in comparison to 2015. The main reason of this increase was the domestic demand increase for laser and water jet machines. Switzerland and Germany came forward among import countries of Turkey.

In 2016, the export of machine tools in group 8456 was realized as USD 88.029.950. This meant a 1,8% increase in comparison to 2015. The reason of this increase was the international demand increase for laser machines. Canada and Saudi Arabia came forward among export countries of Turkey.

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8457: Metal working machining centers, single station and multi-station transfer machines

In 2016, the import of machining centers and transfer machines in group 8457 was realized as USD 265.424.605. This meant a 0,9% decrease in comparison to 2015. Germany and Taiwan came forward among import countries of Turkey. This group had the biggest share with 27% in metal working machine tools export.

In 2016, the export of machining centers and transfer machines in group 8457, of which the production needs high technology, was realized as USD 8.593.476. This meant a 24,08% decrease in comparison to 2015. Germany and Algeria came forward among export countries of Turkey.

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8458: Metal working lathes (incl. turning centers)

In 2016, the import of lathes in group 8458 was realized as USD 172.157.194. This meant a 6,98% decrease in comparison to 2015. Taiwan and Japan came forward among import countries of Turkey.

In 2016, the export of lathes in group 8458 was realized as USD 6.714.611. This meant a 5,64% increase in comparison to 2015. Companies that operate in free zones and Germany came forward among export countries of Turkey.

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8459: Machine tools for boring, reaming, milling, threading etc. metals through machining

In 2016, the import of milling and drilling machines in group 8459 was realized as USD 65.180.996. This meant a 1,82% decrease in comparison to 2015. Germany and China came forward among import countries of Turkey.

In 2016, the export of milling and drilling machines in group 8459 was realized as USD 10.093.365. This meant a 10,13% decrease in comparison to 2015. Companies that operate in free zones and Germany came forward among export countriesof Turkey.

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8460: Machine tools for polishing, deburring, sharpening, grinding, honing, lapping etc. metals and cermets

In 2016, the import of grinding, sharpening, honing, lapping machines in group 8460 was realized as USD 72.433.703. This meant a 0,7% decrease in comparison to 2015. Germany and Italy came forward among import countries of Turkey.

In 2016, the export of grinding, sharpening, honing, lapping machines in group 8460 was realized as USD 7.170.860. This meant a 5,67% decrease in comparison to 2015. Germany came forward among export countries of Turkey.

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8461: Machine tools for working metals or cermets through machining such as shaping, beveling, broaching,gear shaping, sawing, slitting

In 2016, the import of shaping, beveling, broaching, gear shaping, sawing, slitting machines in group 8461 was realized as USD 44.383.119. This meant a 30,33% increase in comparison to 2015. Germany and Italy came forward among import countries of Turkey.

In 2016, the export of shaping, beveling, broaching, gear shaping, sawing, slitting machines in group 8461 was realized as USD 16.013.155. This meant an 18,6% decrease in comparison to 2015. Germany and Canada came forward among export countries of Turkey.

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8462: Machine tools for forging, hammering, die forging, cutting, drafting, engraving forge press, carbide finishing on metals

In 2016, the import of forging, hammering, die forging, cutting, drafting machines in group 8462 was realized as USD 204.643.289. This meant a 2,07% decrease in comparison to 2015. Germany and Italy came forward among import countries of Turkey. This group had the second biggest share in metal working machine tools import with 21%.

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In 2016, the export of forging, hammering, die forging, cutting, drafting machines in group 8462 was realized as USD 254.965.187. This meant a 9,84% decrease in comparison to 2015. Germany and USA came forward among export countries of Turkey. This group had the biggest share in metal working machine tools export with 62%. Moreover, the compension rate of export/import of these machines were 125% and it was the only group in metal working machine tools, which had export surplus.

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8463: Machine tools for working metal, sintered metal carbides or cermets, without removing material (excl. forging, bending)

In 2016, the import of chipless machining metal and cermet working machines in group 8463 was realized as USD 64.911.926. This meant a 23,03% increase in comparison to 2015. Germany and Italy came forward among import countries of Turkey.

In 2016 the export of chipless machining metal and cermet working machines in group 8463 was realized as USD 21.000.014. This meant a 16,55% decrease in comparison to 2015. Germany came forward among export countries of Turkey.

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RESULT

When the manufacturing industry is considered, even though the machining centers in 8457 group are needed more, the manufacturing of these machines in Turkey is low.

When all machine tools for working metal are considered, the high tech-machining centers and transfer machines which have low production in Turkey, create the 45% of the import/export gap of USD 567 million in total. The manufactured machines in Turkey cannot meet the quality demands of defense, aviation, medical and automotive sectors which have very high added values.

In spite of this situation, there are machine types that Turkey is strong in production. These are laser machines in 8456 group and forging press, rounding/straightening press, hydraulic press, guillotine, punch, bending press in group 8462.

The compension rate of export/import of machines in 8456 group (laser, electro erosion, water jet) is 97%. There is a 25% export surplus in the compension rate of export/import of press machines in 8462 group. The export of the machines in these two groups generates the 83% of the machine tools for working metal export.

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There was an increase of 0,42% in import in 2016 when compared to 2015. There was not a significant change in the order of the importing countries. In 2016, the imports from Germany, Taiwan, Italy, Japan, and China which were the first ranked countries of Turkey’s import was 74% of the total import.

SITUATION IN IMPORT

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When taken into account all machine tools for working metal, there was a decrease of 8,44% in export in 2016 in comparison with 2015. When there was a considerable increase in export to USA and Canada, to the closer region countries such as Saudi Arabia, Poland, Russia, Iran, Czech Republic and Iraq, there was a significant decrease of 37%.

SITUATION IN EXPORT

NOTES