Tofaş: The industrial giant of Turkey
Turkish automotive company, Tofaş, whose foundations were laid by founder of the Koç Community, deceased Vehbi Koç, in 1968, and which has equal shareholders as Koç Holding and Fiat Chrysler Automobiles (FCA), today is one of the two R&D centres of FCA in Europe. Being the fifth largest industrial enterprise of Turkey, Tofaş has an annual manufacturing capacity of 400 thousand vehicles with 10.000 employees. Today operating on a land of 1 million m2 with an indoor area of 350 thousand m2, Tofaş constantly enhances its competitive capacity.
Being the only automotive company which manufactures a range of passenger cars, Fiat Linea and Egea, as well as Light Commercial Vehicles for Fiat, Citroen, and Peugeot under its Minicargo project and for Fiat, Opel, Vauxhall, and RAM under its New Doblò Project in Bursa Plant. Tofaş undertakes the representation of 6 brands (Fiat, Alfa Romeo, Lancia, Jeep, Maserati, Ferrari) in the domestic market.
Tofaş has acted in line with the philosophy “Giving back to these lands what was earned thanks to them; growing together with Turkey” from the date of establishment and conducts many projects focusing on the fields of education, culture-arts and sports within the scope of corporate social responsibility activities.
Performance in 2015
Tofaş, the leading company of the Turkish automotive industry, 2014 has become a historical year with its new model investments, attempts at getting into new markets, R&D studies, and achievements in the field of corporate sustainability. The Company increased its performance in respect of the operating results despite the shrinkage having occurred in the domestic market of the industry. Having reached the highest sales income in its history in 2015, Tofaş recorded a net sales income of 10 billion TL with a 33% increase compared to the previous year and a net profit of 831 million with a 45% increase. Tofaş realized 25% of the total automotive production in Turkey with a production of 278.252vehicles. Tofaş’s total exports increased by 22.2% on a unit-sale basis in 2015 and reached 173,873 vehicles. With the inclusion of the sales of its Alfa Romeo, Ferrari, Jeep, Lancia, and Maserati models, the company’s market share reaches 12% in 2015. The Linea, which is very popular in our home market, was the best-selling vehicle in Turkey last year with 35,041 units sold. The newly introduced Fiat Egea also managed to rack up retail-market sales of 5,674 units despite the fact that production began on 28 September and the car did not go on sale until November. Jeep sales shot up by a hefty 78.9% last year, a performance that was driven especially by strong demand for the Renegade. In order to protect and increase its short and medium-term profitability, Tofaş explores ways to improve manufacturing productivity while also developing new products and technologies. In line with this the company effectively managed its production operations in 2015 so as to respond optimally to market demand.
By planning its next 20 years; Tofaş took an investment decision worth 880 million US dollars in total for Doblo America, Doblo FL and new passenger car projects.
The Doblo America project – which Tofaş carried out with an investment of 360 million US dollars in accordance with the customer demands and regulations in North America and Canada – will provide a valuable experience opportunity for Tofaş and Turkish supplier-industry. Within the scope of the project, Tofaş is planning to export 175,000 units of vehicles between 2014 and 2021. Along with the renewal operations that would be maintained together with that project, Fiat Doblo’s lifespan will be prolonged from 2018 to 2021.
Fiat Egea further boosts the global competitive strength of Tofaş that increases the added value it generates for the national economy with its investments in technology and innovation. A ceremony was held in October 2015 when the first Fiat Egea rolled off the assembly line. A total of 580 thousand Fiat Egea sedans are planned for production between 2015 and 2023. Total output, which reached 270 thousand units in 2015, is expected to approach full capacity in 2016 with the introduction of the Egea family’s Hatchback and Station Wagon models. A third of these are earmarked for export and will be marketed abroad as “Fiat Tipo”. Fiat Egea attracted tremendous attention as soon as it made its debut and was voted “Best-Buy Car Of The Year in Europe” at AutoBest 2015.
Tofaş established its R&D organization in 1994. Tofaş has a R&D vision as “developing vehicles and technologies fulfilling customer satisfaction in every part of the world” so Tofaş R&D Centre is aimed at providing contribution to the profitability of Turkish society, economy and to Tofaş by developing automobiles and commercial vehicles that are competitive in every field. Tofaş R&D Centre has been registered as the R&D Centre by Ministry of Industry and Commerce within the scope of the law on “No. 5746 Supporting Research and Development Activities” as of 2008.
Today Tofaş R&D Centre, apart from Italy, is the only R&D center that provides services for FCA’s European markets with its over 700 employees, competency level, high technology and diversity of its laboratories.
As a result of innovative work carried out at Tofaş R&D Center in 2015, there were 110% and 32% year-on rises respectively in declaration of invention and patent application numbers, with a total of 106 new applications being submitted.At the fourth round of the Private Sector R&D Centers Summit organized by the Ministry of Science, Industry and Technology, Tofaş R&D Center was not only cited as the best R&D center in the Turkish automotive industry but also placed third among the country’s best R&D centers in all categories. Tofaş additionally ranked first on the basis of “R&D Expenditure Density” and “Project Capacity”.
World Class Manufacturing
In line with its’ future perspective and sustainability principle, Tofaş is integrating its activities’ environmental and social effects, as well as their economic outcomes, into the company policies. Having an important place in FCA World under the World Class Manufacturing (WCM) programme, Tofaş serves as a model with its environmentalist approach and practices. In line with these works, Tofaş Bursa Plant rose to the “Golden Level” in 2013 within the scope of WCM that is implemented in 566 plants and suppliers of FCA and went one step further in the global competition.
Tofaş is a member of the Carbon Disclosure Project and, because of its demonstrated commitment to sustainability issues, its shares are included in the Borsa İstanbul Sustainability Index. Tofaş received an award in the “Carbon and Energy Management” category at the 2015 Green Business Summit and, owing to its progress in corporate governance principles compliance, its corporate governance rating was increased to 9.06.
2015 and beyond
The mission of Tofaş is “to increase the quality of living by offering products and services that best fit the society’s mobility needs” and its vision is “towards a million of vehicles, to become the leading automotive company that shapes customer expectations and be a source of pride”. Together with the awareness of social and environmental responsibilities, Tofaş continues to work for sustainable and profitable growth in the long term within the framework of its mission and vision. The long-term targets of Tofaş being a strong manufacturer and distributor include being a company based on sustainable growth and profitability through manufacturing capacities, power of technology and added value it creates for its stakeholders.
Tofaş and the Ecosystem
According to the research conducted by GFK, Tofaş is among the main industry companies, which their suppliers are very satisfied to work with Tofaş is currently working with 2000 supplier companies receiving indirect materials and services together with 152 local and 20 foreign supplier companies receiving direct materials and services. Aiming at carrying not only itself but also all of its stakeholders into the ecosystem to the future, Tofaş provides cooperation opportunities with suppliers in its design and product development projects. Achieving a decline in the investment and product costs due to the development of suppliers’ design and production competencies provides a significant competition advantage both for Tofaş and the suppliers.
Tofaş dealership network provides new vehicle sales, used vehicle sales, maintenance-repairing and spare part service to the customers. In addition, several dealers provide insurance services (motor insurance, traffic insurance) and versatile financial services (vehicle loan). Tofaş has a total of 81 dealerships in Turkey, which also sell Fiat, Lancia, Alfa Romeo and Jeep branded vehicles.Tofaş provides service in Turkey with a total of 113 sales and 135 service points. Tofaş dealers set up additional sales and service points in different locations apart from the main facilities in order to be able to provide a better service to its’ customers. It provides service with 40 “satellite” sales and service points in addition to the 40 authorized technical services
Tofaş in the Corporate Governance Index
Today, Tofaş is the automotive company which has the highest grade in the Borsa Istanbul Corporate Governance Index. Increasing its grade since 2007 in which the Corporate Governance Index was established, Tofaş received “the Highest Graded Corporate” award in the category of Management Board of the Corporate Governance Awards by increasing its grade to 9,14 level in 2013 which was 7,57 out of 10 in 2007. This grade shows that how Tofaş is managed in a fair, transparent, accountable and responsible manner for all of its stakeholders.
Occupational Health and Safety Policy in Tofaş
Part of its World Class Manufacture, Tofaş adapts the Proactive and Basic Workplace Safety 7 step approach in order to ensure a secure workplace, to create an occupational health culture and to protect each corporate employees from every type of health deficiencies and work injuries. With the Occupational and Health Safety Policy management, Tofaş targets “zero” occupational injuries and “zero” waste
Tofaş was the recipient of good-practice awards in two consecutive rounds (2012-2013 and 2014-2015) of the European Agency for Safety and Health at Work’s biennial campaigns. At the national level it has won two awards–“Golden Gloves” in the Companies category and “Golden Suggestion” in the Individuals category–in the “Occupational Health & Safety Best Practices Awards” program conducted by the Metal Industrialists’ Union of Turkey.
Tofaş and Corporate Social Responsibility
Since the day on which it was established, Tofaş has acted with the philosophy of “growing together with Turkey and giving back to these lands what was earned thanks to them”. In the scope of its corporate social responsibility activities, it maintains its ongoing activities in the fields of education, sports, culture and art.
In the field of education, Tofaş supports Fiat Laboratories in the vocational high schools in the scope of “Vocational Education: A Crucial Matter” project led by Koç Holding. Every year, approximately 4000 young persons are making sports in Tofaş Sports Club Basketball Schools.
In the framework of culture – art activities, the Tofaş Anatolian Cars Museum that was opened in 2002 and Tofaş Art Gallery that was established in 2008 in Bursa, keeps reaching to a large mass with organized thematic events. Tofas Art Gallery has hosted the, “Old Hamam, Old Bowl”, “Toy Exhibition” , “Time Machines”, “Here I am: Zeki Müren” exhibitions and “Poise of Steelyard” exhibition continues to host its visitors.
Tofaş also provides significant support in the field of culture and art so our country can be represented abroad as it deserves. In 2011, assuming the sponsorship of Venice Biennale – Pavilion of Turkey with Fiat brand, Tofaş has maintained its support in 2013, as well.
In addition, Tofaş provides support to unearthing of the most important settlement areas in the Anatolian history with the importance that it gives to the cultural heritage. Since 90s, it has assumed the sponsorship of Küçükyalı Excavation Operations as well as Pamukkale Hierapolis which is one of the major 5 antique city remnants of Turkey.
In the field of sports, since 2000 The”Basketball Volunteers” project has been implemented with the collaboration of the Educational Volunteers Foundation ( TEGV). The project aims to teach basketball to 7-14 years old youth lacking sports facilities in their living areas. Since its starts Tofaş has provided basketball trainning for more than 10 thousand childrens and with the FiatBall Basketball Festival started 12 years ago, Tofaş gathers together all students involved in the project all around Turkey
Koç Fiat Kredi Tüketici Finansman A.Ş.
Koç Fiat Kredi offers integrated financial services to the brands represented by Tofaş via 81 distributors throughout Turkey. In 2015 KFK processed about 186 thousand credit applications which 62,818 automotive loan units were extended. KFK’s market share among other finance companies realized at 9%. Last year the company financed 46% of Tofaş’s total sales and 70% of Tofaş sales excluding big fleet sales.
Fer Mas Oto Ticaret A.Ş.
Mas Oto Ticaret A.Ş. was established on 15 April 2005 with Tofaş Türk Otomobil Fabrikası A.Ş. having a 99,4% share. The company has become the official distributor of Ferrari from April 2005 and of Maserati from July 2005 in Turkey.