The Turkish automotive market is shifting from a new vehicle-centric structure to a used vehicle-centric one, with implications for the automotive industry as well as insurance, finance and public policy.
This point was made by Mr Ziya Alp Gulan, Chairman of the Gulan Group, which is engaged in vehicle dealerships, second-hand vehicles, technical services and fleet rentals at a Quick Finans workshop, reported Insurance Media.
As a vehicle fleet ages, a compounding set of risks emerges: the frequency of claims rises while safety features decline. Simultaneously, higher parts and labour costs frequently exceed the depreciating value of older models, rendering repairs economically unviable. The proportion of uninsured vehicles increases.
The data Mr Gulan shared indicates that 55% of the total number of 17.3m cars in Turkiye are 11 years old or older.
|
Age (years)
|
Total Vehicles
|
Market Share
|
Automobiles
|
Market Share
|
Motorcycles
|
Market Share
|
|
0-5
|
10,397,632
|
30.9%
|
4,752,209
|
27.4%
|
3,768,606
|
53.0%
|
|
6-10
|
5,180,575
|
15.4%
|
3,074,575
|
17.7%
|
795,571
|
11.2%
|
|
11-15
|
5,604,649
|
16.7%
|
3,128,326
|
18.0%
|
828,857
|
11.7%
|
|
16-20
|
4,169,475
|
12.4%
|
1,833,786
|
10.6%
|
871,492
|
12.3%
|
|
>20
|
8,260,319
|
24.6%
|
4,584,685
|
26.4%
|
845,438
|
11.9%
|
|
Total
|
33,612,650
|
100.0%
|
17,373,581
|
51.7%
|
7,109,964
|
21.2%
|
Although electric and hybrid vehicle sales are increasing rapidly, their numbers are not sufficient to change the overall age structure of cars on the road. The renewal in the showroom does not reflect the real picture on the road. With more than half of the cars in Turkiye being over 11 years old, it takes time for the new-energy vehicle transformation to be felt throughout the system.
Aging cars and risk profile.
The fact that cars aged 21 years and older account for a particularly high share of 26.4% is a significant indicator of the risk in the car population. In this age bracket, there is:
- Lower insurance coverage rate.
- Limited insurance penetration.
- The damage-repair balance is more fragile.
- More difficult access to financing
Shift in risk-sharing models
The aging of automobiles in Turkiye also creates a vulnerability. An automobile structure with low insurance coverage and a high average age is more susceptible to economic shocks, particularly severe in scenarios involving major floods, hail, or earthquakes. This situation necessitates the redesign of risk-sharing models.
For aging vehicles, models that focus on major damage rather than minor damage, and offer accessible coverage with affordable premiums, are regarded as more meaningful.