Economy
Trump seizes on govt shutdown to dole out firings, political punishment
U.S. President Donald Trump is using the government shutdown as a chance to remake the federal workforce and sideline detractors, meeting Thursday with budget director Russ Vought to discuss “temporary or permanent” spending cuts that could set up a lose-lose dynamic for Democratic lawmakers.
Trump announced the meeting on social media Thursday morning, saying he and Vought would determine “which of the many Democrat Agencies” would be cut – continuing their efforts to slash federal spending by threatening mass firings of workers and suggesting “irreversible” cuts to Democratic priorities.
“I can’t believe the Radical Left Democrats gave me this unprecedented opportunity,” Trump wrote on his social media account. “They are not stupid people, so maybe this is their way of wanting to, quietly and quickly, MAKE AMERICA GREAT AGAIN!”
The post was notable in its explicit embrace of Project 2025, a controversial policy blueprint drafted by the Heritage Foundation that Trump distanced himself from during his reelection campaign. The effort aimed to reshape the federal government around right-wing policies, and Democrats repeatedly pointed to its goals to warn of the consequences of a second Trump administration.
Vought, who heads the Office of Management and Budget (OMB), on Wednesday offered an opening salvo of the pressure he hoped to put on Democrats.
He announced he was withholding $18 billion for the Hudson River rail tunnel and Second Avenue subway line in New York City that have been championed by both Democratic leaders, Senate Democratic leader Chuck Schumer and House Democratic leader Hakeem Jeffries, in their home state. Vought is also canceling $8 billion in green energy projects in states with Democratic senators.
“Trump’s so-called ‘maximum pain’ plan isn’t hurting Democrats – it’s hurting American families,” Schumer said in a statement Thursday. “He’s snatching paychecks, threatening jobs, and deliberately inflicting suffering on working people just to score petty political points.”
Meanwhile, the White House is preparing for mass firings of federal workers, rather than simply furloughing it as is the usual practice during a shutdown. White House press secretary Karoline Leavitt said earlier this week that layoffs were “imminent.”
“If they don’t want further harm on their constituents back home, then they need to reopen the government,” Leavitt said Thursday said of Democrats.
Starring role for Russ Vought
The bespectacled and bearded Vought has emerged as a central figure in the shutdown – promising possible layoffs of government workers that would be a show of strength by the Trump administration as well as a possible liability given the weakening job market and existing voter unhappiness over the economy.
The strategic goal is to increase the political pressure on Democratic lawmakers as agencies tasked with environmental protection, racial equity and addressing poverty, among other things, could be gutted over the course of the shutdown.
But Democratic lawmakers also see Vought as the architect of a strategy to refuse to spend congressionally approved funds, using a tool known as a “pocket rescission” in which the administration submits plans to return unspent money to Congress just before the end of the fiscal year, causing that money to lapse.
All of this means that Democratic spending priorities might be in jeopardy regardless of whether they want to keep the government open or partially closed.
Ahead of the end of the fiscal year in September, Vought used the pocket rescission to block the spending of $4.9 billion in foreign aid.
White House officials refused to speculate on the future use of pocket rescissions after rolling them out in late August. But one of Vought’s former colleagues, insisting on anonymity to discuss the budget director’s plans, said that future pocket rescissions could be 20 times higher.
No endgame in sight
Thursday is Day 2 of the shutdown, and already the dial is turned high.
The aggressive approach coming from the Trump administration is what certain lawmakers and budget observers feared if Congress, which has the responsibility to pass legislation to fund the government, failed to do its work and relinquished control to the White House.
Vought, in a private conference call with House GOP lawmakers Wednesday afternoon, told them of layoffs starting in the next day or two. It’s an extension of the Department of Government Efficiency work under Elon Musk that slashed through the federal government at the start of the year.
“These are all things that the Trump administration has been doing since January 20th,” said House Democratic leader Hakeem Jeffries, referring to the president’s first day in office. “The cruelty is the point.”
House Speaker Mike Johnson underscored Thursday that the shutdown gives Trump and Vought vast power over the federal government. He blamed Democrats and said “they have effectively turned off the legislative branch” and “handed it over to the president.”
“When Congress turns off the funding, and the funding runs out, it is up to the commander-in-chief, the president of the United States, to determine how those resources will be spent,” Johnson said.
Still, Johnson said that Trump and Vought take “no pleasure in this.”
Trump and the congressional leaders are not expected to meet again soon. Congress has no action scheduled Thursday in observance of the Jewish holy day, with senators due back Friday. The House is set to resume session next week.
The Democrats are holding fast to their demands to preserve health care funding and refusing to back a bill that fails to do so, warning of price spikes for millions of Americans nationwide.
Shutdown could harm economy
With no easy endgame at hand, the standoff risks dragging deeper into October, when federal workers who remain on the job will begin missing paychecks. The nonpartisan Congressional Budget Office has estimated roughly 750,000 federal workers could be furloughed on any given day during the shutdown, a loss of $400 million daily in wages.
The economic effects could spill over into the broader economy. Past shutdowns saw “reduced aggregate demand in the private sector for goods and services, pushing down GDP,” the CBO said.
“Stalled federal spending on goods and services led to a loss of private-sector income that further reduced demand for other goods and services in the economy,” it said. Overall CBO said there was a “dampening of economic output,” but that reversed once people returned to work.
Past shutdowns have done minimal economic damage, in part because their consequences were either contained or reversed once the government fully reopened. But the impact would be different if there were permanent layoffs at a time when the labor market was already starting to struggle.
With Congress at a standstill, the Trump administration has taken advantage of new levers to determine how to shape the federal government.
The Trump administration can tap into funds to pay workers at the Defense Department and Homeland Security from what’s commonly called the “One Big Beautiful Bill” that was signed into law this summer, according to the CBO.
That would ensure Trump’s immigration enforcement and mass deportation agenda is uninterrupted. But employees who remain on the job at many other agencies will have to wait for the government to reopen before they get a paycheck.
Surging copper prices have helped Australian mining titan BHP post a solid rise in annual profits, according to financial results shared by the company on Tuesday.
Copper is a key metal for the global energy transition and artificial data centers.
Net profit climbed 9% from a year earlier to $9.8 billion in the financial year to June 30, said the resources group, the world’s biggest miner by market value.
Revenue rose 14.6% to $58.8 billion.
BHP is the world’s biggest copper producer and plans to expand output of the red metal by about 40% by 2035, the group said in a statement.
The miner also reported record iron ore production and a strong result in coal, but copper was the star commodity and expected to remain so.
“Copper is the engine that is driving BHP’s growth,” chief executive Brandon Craig said.
Copper prices were 26% higher on average in the 2026 financial year, the company said.
The metal has eclipsed iron ore as the biggest earner for BHP, generating more than half of the group’s operating profit for the first time.
Global copper demand is expected to grow to more than 50 million tons by 2050, it said.
As economies expand, copper will be required to build electricity networks for the transition away from fossil fuels, and to create data centers for artificial intelligence, BHP said.
“We also see a looming global copper supply challenge, as existing copper mines age, and with the pipeline of potential projects less healthy than in previous cycles.”
The group said it would pay shareholders a four-year record high dividend of of $1.72 a share, equal to $8.7 billion.
BHP shares climbed 3.3% to AU$64.24 ($45.63) in morning trade.
What began on a July weekend has grown into a month-long wave of attacks stretching from Moscow and St. Petersburg to cities in the south and all the way to the Ural Mountains. But the targets were not refineries, ports or arms factories, but warehouses that keep online shopping running across Russia.
Ukraine’s drones have pummeled the giant depots belonging to Wildberries, Russia’s biggest online retailer, burning billions of dollars’ worth of merchandise and bringing the war home to the broad public.
The attacks on about 20 Wildberries facilities have underlined Kyiv’s ability to strike far and wide inside Russia and posed a new challenge to President Vladimir Putin nearly four-and-a-half years into his full-scale invasion of Ukraine.
They have badly shaken the empire built by Tatyana Kim, the country’s richest female entrepreneur, whose fortune has been estimated at $8.1 billion.
Hundreds of thousands of individual sellers have lost their merchandise, sending shock waves across Russia’s economy. Wildberries has drawn massive loans from VTB and other banks as it expanded and likely will have trouble repaying them, putting more pressure on the financial system.
Online giant began in Moscow apartment
Kim, 50, was born in Grozny, the capital of the province of Chechnya, to an ethnic Korean family of an engineer and a teacher. She launched Wildberries in 2004 from her Moscow apartment soon after giving birth to her first child while working as an English teacher.
“The idea was born from my own needs, and turned out to be needed by hundreds of thousands,” said Kim, now a mother of seven. “If a product or service makes your own life easier, you’re on the right track.”
Wildberries initially sold clothing before expanding to appliances, household items, cosmetics, books and more. The platform with its distinct purple logo has become an undisputed leader in e-commerce, accounting for about half of all online orders in Russia. Businesses big and small use it to store, ship and deliver merchandise across the country’s 11 time zones.
An estimated 500,000 to 800,000 sellers use Wildberries, often described as Russia’s Amazon. After Western brands fled following the war in Ukraine, online retailers filled the void with merchandise from China, Turkey, the United Arab Emirates (UAE) and elsewhere.
The company also acquired a bank, expanded to tourism and even considered buying an airline.
In 2024, Kim divorced her husband, Vladislav Bakalchuk, triggering a fight for control of the company. Bakalchuk sought the support of Chechen leader Ramzan Kadyrov and his feared paramilitary forces but eventually lost the battle, which peaked in a shootout at a business center near the Kremlin that left two people dead and several wounded.
Wildberries depots easy targets
The company has prided itself on relying on about two dozen mammoth warehouses as the core of its vast logistical network, stockpiling the goods before shipping to about 100,000 storefront distribution points nationwide.
Rival online retailers Ozon and Yandex Market use smaller depots spread over a wider network.
As Ukraine embarked on a strategy of using long-range drones to attack deep inside Russia, it has expanded from striking military bases, oil refineries and other infrastructure to Wildberries warehouses, which provided particularly soft targets.
Since the first attack July 18 in Elektrostal, just east of Moscow, and in the southwestern Tambov region, Wildberries depots burned one after another in massive fires that flooded social media.
The depots, some as big as 300,000 square meters (about 3.2 million square feet), were unprotected and easy to set ablaze. It took three days to extinguish the fire in the Elektrostal depot, the Moscow region’s main hub.
“These are not military and high-value political targets; therefore, they’re not especially secured, they’re not really built to be able to shrug off drone strikes,” said podcaster Mark Galeotti, a Russia expert who heads the Mayak Intelligence consultancy.
The strikes have stretched from the European part of Russia to Yekaterinburg, over 2,000 kilometers (about 1,250 miles) from Ukraine’s border.
There’s scarce public data, but some estimates indicate that up to 20% of the company’s total warehouse space has been destroyed, with assessments of losses running as high as $6 billion.
Kim said Wildberries’ sites have been “reinforced and strengthened” defensively, but the attacks continued. Some warehouses suffered only minor damage, and Ukraine tried to hit them again.
Wildberries said it’s rearranging supply chains to create “partner hubs” for storing merchandise – a long and challenging process, given its dependence on big depots.
Attacks’ ripple effect
Ukrainian officials have said Wildberries sells gear and technical components, including drones, to the military. Moscow denied it, but such dual-use items as drone components, flak jackets or thermal weapon sights remain available on the platform.
Mykhailo Podolyak, an adviser to Ukrainian President Volodymyr Zelenskyy, said the attacks were designed to disrupt military supplies, breed popular discontent and cause a domino effect in the Russian economy by putting stress on major banks, including VTB and Sberbank, that made massive loans to Wildberries.
Wildberries’ debts were estimated at the equivalent of about $15 billion at the end of 2025.
Russia’s small and medium businesses have already been hit hard by tax increases, regulatory hurdles and, most recently, a fuel crisis from attacks on oil refineries.
The strikes on Wildberries have further exacerbated the business environment, said Chris Weafer, CEO of Macro-Advisory Ltd. Consultancy.
“I wouldn’t say it’s a nail in the coffin because we’re not there yet, but it’s certainly another enormous difficulty on top of what has already been a very difficult situation for small enterprises,” Weafer said.
Wildberries had recently changed its seller policy, exempting it from liability for stock damaged by a “force majeure” that includes drone attacks.
Kim pledged to support sellers with discounts on storage, free transfer of goods to other sites, discounted loans and other measures. Wildberries also issued some reimbursements, but they covered only a fraction of the losses.
Russia’s Central Bank has asked lenders to restructure loans to small and medium businesses that lost merchandise.
Meanwhile, many owners of Wildberries pickup points face lost revenue amid the plunging deliveries. Some vented frustrations on social media about going out of business.
The lost goods mean tens of thousands of small businesses can’t continue to operate, service their loans or pay taxes. Many are pleading for government support.
Galeotti said the strikes reflected Kyiv’s effort to bring the war home to Russia.
“It’s not just about seeing great clouds of black smoke over your cities because of some oil refinery on the outskirts being hit,” he said. “You might be a small business whose inventory has just gone up in smoke in one of the Wildberries’ warehouses. Or else you just simply might be an ordinary consumer who just suddenly is no longer going to get the goods that you plan to buy.”
Some analysts warn that instead of provoking discontent, the attacks could fuel stronger anti-Ukrainian and anti-Western fervor.
The Wildberries attacks have played into the hands of Russian hawks who urge escalating the war, said pro-Kremlin political expert Sergei Markov.
“It strengthens the view that it’s necessary to hit Europe,” he said. “And better sooner than later.”
Former President Dmitry Medvedev sought to stir up anger at Ukraine for trying to destroy an essential part of the daily routine for millions.
“Our enemy is fighting not the Russian leadership or the army, but ordinary citizens,” he said.
U.S. President Donald Trump is vowing to increase economic pressure on Iran and Treasury Secretary Scott Bessent has said Washington would introduce measures against Tehran “never been seen” as early as this week.
The United States, United Nations and European Union have applied sanctions, implemented trade embargos and frozen assets since the late 1970s over Iran’s nuclear program, human rights violations and support for militant groups.
Since the Iran war began in February, Washington has levied additional maritime, energy and financial sanctions and started a naval blockade.
Data from the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) shows the agency has imposed sanctions on more than 1,000 people, vessels and aircraft since Trump began his second term.
Recent measures have targeted Iran’s shadow oil fleet; shipping insurers; entities and people enabling Iran’s acquisition of weapons; and digital exchanges, freezing an estimated $500 billion in Iran-linked cryptocurrency.
Experts say the Trump administration also could try these options.
Sanctions on Chinese ‘teapot’ refiners
Chinese independent refineries known as “teapots” account for a quarter of Chinese refinery capacity. They operate with narrow and sometimes negative profit margins.
China buys more than 80% of Iran’s shipped oil, according to 2025 data from analytics firm Kpler. Independent refiners absorb much of this trade, exposing them to so-called secondary measures that penalize entities helping a primary sanctions target.
Past U.S. sanctions have deterred larger independent refiners from buying Iranian oil. But the independent refineries are somewhat immune since they have little exposure to the U.S. financial system, sanctions experts say.
Sanctions on Chinese banks
OFAC has imposed secondary sanctions on smaller China- and Hong Kong-based entities accused of processing billions of dollars in Iranian oil and helping to fund weapons procurement.
Treasury has warned two larger Chinese banks they could face secondary sanctions if Iranian funds were found moving through their systems, but has stopped short of designating them.
Hitting those two banks, which U.S. officials have not publicly identified, or imposing other sanctions could have a chilling effect on bigger financial institutions, sanctions experts said, although they warned it could also trigger retaliatory actions by Beijing.
Trump administration officials have sought to play down tensions between Washington and Beijing ahead of an expected meeting between Trump and President Xi Jinping later this year.
They worry that China could curtail exports of critical minerals that are essential to advanced technology production at a time when the U.S. and Western allies are still trying to develop their own supplies.
‘Whack-a-mole’
The United States could continue targeting Iranian individuals and entities, as well as others in China and the Gulf, that are helping Tehran evade sanctions to collect revenues for its war effort.
Treasury recently issued sanctions against firms that are springing up to facilitate Iran’s trading of oil revenue for imports. But such measures amount to a “whack-a-mole” approach that has not altered Iran’s behavior, said Brett Erickson, managing principal of Obsidian Risk Advisors, noting that Tehran simply creates new entities to replace them.
Miad Maleki, a sanctions expert with the Foundation for Defense of Democracies, said Bessent was likely signaling a sharpened enforcement push against oil shippers, purchasers and currency exchangers who help Iran pay for its imports.
Further aviation sanctions were also possible, aimed at degrading Iran’s ability to move trade now that the U.S. has blockaded shipping via the Strait of Hormuz, he added.
Land blockade
Some U.S. and Israeli officials have floated the prospect of a land blockade, which would require assistance from Iran’s neighbors: Iraq, Türkiye, Pakistan, Afghanistan, Turkmenistan, Azerbaijan and Armenia.
The Trump administration has varying degrees of closeness with all those countries except Afghanistan, but that border is mountainous and extremely difficult to patrol anyway.
A land blockade could increase pressure on the Iranian people by halting their imports of food, energy and textiles, but experts say such a move would be difficult to execute and might not result in protests or internal pressure.
Secondary tariffs
Trump has repeatedly threatened tariffs on goods from countries that do business with Iran, although the Supreme Court struck down the legal basis for such taxes.
The Senate passed a sweeping Russia sanctions bill last week that included new Iran sanctions and would give Trump new tariff powers that he could potentially use against countries that aid Iran’s commerce and weapons procurement.
That legislation must still pass the U.S. House of Representatives, which could prove challenging given widespread concerns among Democrats and some Republicans about the tariff measures.
Istanbul Airport has set new records for daily flights and passenger traffic, Transport and Infrastructure Minister Abdulkadir Uraloğlu said Monday.
Türkiye’s largest airport and one of the biggest civil aviation hubs in the world handled 1,739 flights and 290,287 passengers on Sunday.
The figures marked the highest number of daily flights and passengers ever recorded at an airport in Türkiye and Europe, Uraloğlu said in a statement.
The passenger count renews Istanbul Airport’s previous peak of 289,732 reported on the same day a week ago.
The new records further strengthen Istanbul Airport’s position as a major international aviation hub, Uraloğlu said.
“Istanbul Airport is among the world’s leading airports with its capacity, strong infrastructure and quality of service,” he noted.
“These new records once again demonstrate that our airport is further strengthening its position as a global transfer hub.”
The gleaming glass-and-steel structure along the Black Sea coast turned into one of the most important transit centers in aviation since it became fully operational in April 2019.
The hub can handle 90 million passengers a year in the current phase. The figure is nothing compared to its potential capacity to serve 200 million after completing all phases.
Istanbul Airport served record-breaking 84.4 million passengers in 2025, making it the second-busiest airport in Europe after Heathrow Airport and the eighth-busiest worldwide. It seeks to reach the 90 million mark this year.
Sabiha Gökçen also sets passenger record
Across the city, Türkiye’s second-largest airport also recorded its highest-ever daily passenger traffic on the same day.
Sabiha Gökçen International Airport said it had handled 180,914 passengers across 958 flights on Sunday.
It said it saw new daily records for international arriving and departing passengers, domestic passenger traffic, total international flights and international departures.
The airport additionally set a record for aircraft served through Passenger Boarding Bridges (PBBs). A total of 218 aircraft used the boarding bridges on Sunday, surpassing the previous daily record of 212.
Hanita Ahmad, executive director of Sabiha Gökçen, said passenger traffic had surpassed 180,000 for the first time, reflecting both strong demand for the airport and its operational capacity.
“As Sabiha Gökçen, we will continue focusing on continuously improving the passenger experience and sustainable growth in line with our vision of becoming a regional transfer hub,” Ahmad said.
Türkiye’s central government budget swung to a deficit in July, but Treasury and Finance Minister Mehmet Şimşek said the government remains on track with its fiscal targets despite the impact of geopolitical developments.
The budget recorded a TL 378.1 billion ($7.89 billion) deficit last month, according to data from the Treasury and Finance Ministry. That follows a TL 114.2 billion surplus in June.
Budget expenditures totaled TL 1.79 trillion, while revenues reached TL 1.41 trillion in July. The primary balance posted a deficit of TL 51.3 billion, while interest payments amounted to TL 326.8 billion.
Despite the monthly deficit, Şimşek said the government was maintaining fiscal discipline and progressing in line with its budget goals.
For the January-July period, the budget registered a deficit of TL 1.32 trillion. Expenditures reached TL 10.52 trillion, compared with revenues of TL 9.20 trillion.
The government recorded a TL 470.1 billion primary surplus during the first seven months of the year, as primary expenditures totaled TL 8.73 trillion.
The primary surplus, an important indicator of the government’s fiscal position excluding interest payments, increased by TL 228 billion from the same period a year earlier, Şimşek said.
Tax revenues also continued to rise. Tax collections increased 30% year-over-year in July to TL nearly 1.24 trillion, while other non-tax general budget revenues rose 18.9% to TL 145.6 billion.
Fiscal policy to support disinflation
Şimşek said fiscal policy was being implemented with the broader disinflation program in mind.
He noted that the government had forgone a significant amount of tax revenue through the sliding-scale tax mechanism on fuel prices to help support the disinflation process. He also said the ongoing rebalancing of domestic demand had affected revenue performance.
“Despite the significant tax revenue forgone under the sliding-scale mechanism to support disinflation and the impact of the rebalancing in domestic demand on revenue performance, we are progressing in line with our budget targets,” Şimşek said.
The minister added that the government had kept its domestic debt rollover ratio at around 87%, taking financing conditions into account.
He said stronger revenue collection and tighter spending discipline had created fiscal space that would be directed toward priority areas while continuing to support the disinflation process.
“With increased effectiveness in our revenue policies and stronger spending discipline, we will continue directing the fiscal space we have created toward priority areas and supporting the disinflation process,” Şimşek said.
Türkiye’s automotive production fell 8% year-over-year in the first seven months of 2026, while exports by volume declined 14%, as weaker passenger car output and fewer working days weighed on the sector, data showed Monday.
But industry officials said the decline partly reflects preparations by automakers to introduce new models and expand capacity, with the impact of those investments expected to become more visible in the final quarter and particularly in 2027.
Automotive Industry Association (OSD) Chair Cengiz Eroldu said some of their members were preparing their production lines for new models and capacity investments.
“When a new product is introduced to a production line, the existing production pace has to be reduced for a certain period. We consider the production loss to be a normal consequence of the transition to new investments,” Eroldu said.
Hyundai, Opel and Peugeot just recently announced new investments and launches of production of new models in Türkiye.
Hyundai on Friday started mass production of its new all-electric IONIQ 3 model at a factory in Türkiye’s northwestern Kocaeli province.
Earlier this month, Opel said it was moving production of its light commercial vehicle model Combo to Türkiye from the third quarter of this year.
In late July, Peugeot announced it would begin producing its Rifter light commercial vehicle in Türkiye beginning in the third quarter.
Production falls as passenger car output weakens
Eroldu, meanwhile, said the sector also lost around five to six working days in the first seven months compared with the same period last year because of public holidays and administrative leave.
Total automotive production reached 767,216 vehicles in January-July, down 8% from a year earlier, the OSD data showed. Passenger car production declined 19% to 424,667 units.
Commercial vehicle production, however, remained more resilient, rising 9%. Within the segment, production increased 16% for midibuses, 15% for light trucks, 8% for buses and 1% for trucks, while minibus production fell 9%.
The industry’s overall capacity utilization rate stood at 62%, with utilization at 63% for light vehicles, 69% for buses and midibuses, 57% for trucks and just 28% for tractors.
Eroldu said the differing performance across vehicle categories was significant.
“Production declines were concentrated mainly on the passenger car side, while we are seeing a more positive trend in light commercial and heavy commercial vehicles,” he said, adding that the sharp decline in tractor production and the more than 50% contraction in the domestic tractor market warranted attention.
New investments expected to lift local production
Despite the production decline, Eroldu said new investments were already beginning to support the share of locally produced vehicles in the domestic market.
The share of domestically produced vehicles in the passenger car market rose to 35% from 29% a year earlier. Locally produced passenger car sales increased 4%, while imported sales fell 19%.
In the light commercial vehicle market, locally produced vehicle sales rose 13%, lifting their share to 23%, while imported sales fell 9%.
Eroldu said the increase in the domestic share was an early indication of the impact of new investments and that the contribution should become more pronounced as production of new models ramps up.
“The positive impact of new models entering production and export programs will become apparent in the final quarter of the year and, more significantly, in 2027,” he said.
Export volumes decline, but revenue remains resilient
Automotive exports fell 14% by volume to 542,401 vehicles during the first seven months, according to the OSD data. About 71% of total production was exported.
Passenger car exports dropped 29% to 255,679 units, while commercial vehicle exports increased 8%. Tractor exports rose 20% to 7,792 units.
Despite the decline in unit exports, export revenue continued to increase. According to Türkiye Exporters Assembly (TIM) data, total automotive exports rose by around 2%-2.6% in dollar terms to approximately $24 billion.
Uludağ Automotive Industry Exporters’ Association data showed passenger car export revenue fell 9% to $6.3 billion, while exports by main manufacturers increased 0.1% and those by suppliers rose 4.5%.
Automotive remained Türkiye’s leading export sector, accounting for 17% of total exports.
Domestic market contracts, but local share increases
The total automotive market shrank 11% year-over-year to 661,249 vehicles in January-July. Passenger-car sales fell 12% to 502,712, while the commercial vehicle market contracted 5%.
Heavy commercial vehicle sales declined 8%, but bus sales rose 23% and midibus sales increased 14%.
Eroldu noted that despite the market contraction, the sector remained significantly above its long-term averages. Compared with the previous 10-year average, the total market was 31% higher, the passenger car market 32% higher, the light commercial market 30% higher and the heavy commercial market 22% higher.
Europe remains key to industry’s outlook
Eroldu said the performance of the domestic market, demand and competitive conditions in Europe, and the implementation of new models would be critical for the remainder of the year.
He expects full-year production and exports to remain somewhat below 2025 levels but relatively close to last year’s performance.
Looking ahead to 2027, the sector will focus on domestic demand, global vehicle demand, China’s competitive pressure, cost pressures, excess capacity and the European Union’s proposed Industrial Acceleration Act (IAA).
Europe accounts for around 70% of Türkiye’s automotive exports, making the outcome of the IAA negotiations particularly important for Turkish manufacturers and suppliers.
“We expect the negotiation process to extend into 2027,” Eroldu said, stressing that Türkiye’s automotive industry is deeply integrated with Europe’s manufacturing, investment and supply chains.
He said the industry wants Türkiye to be treated within the EU framework as a customs union partner and an integral part of the European automotive value chain, covering both vehicle manufacturers and suppliers.
Eroldu also said that reducing cost pressures caused by the gap between exchange rates and inflation, improving exporters’ access to finance and maintaining predictability in the investment environment would be crucial to the industry’s competitiveness in 2027.
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