The recent adjustment to ÖTV regulation in Türkiye is already reshaping customer behavior in the automotive market, according to Toyota Türkiye CEO Ali Haydar Bozkurt. Speaking at a media briefing evaluating both Türkiye’s automotive performance and Toyota’s results for the first seven months of 2025, Bozkurt emphasized that the revised tax brackets are influencing model preferences and creating new dynamics between locally produced and imported vehicles. He also shared that Toyota Türkiye is heading toward record-breaking sales, expecting to surpass 85,000 units by year-end.
How the New ÖTV Regulation Changes the Market
Under the previous structure, ÖTV (Special Consumption Tax) brackets for cars had been fixed for years, primarily clustered at 70 to 100 percent. The new regulation introduced last month has created a more segmented system, with locally produced models benefitting from lower rates while many imported and luxury vehicles face higher taxation.
Bozkurt explained that the updated framework offers Türkiye-made cars an advantage at the 70 percent bracket, while most imported vehicles now fall under the 80 or 90 percent categories. Luxury cars, which were already considered niche purchases, are now firmly placed in the 100 percent bracket. This creates a 20 percent tax gap between domestic and imported models, a change expected to boost sales of locally produced vehicles while challenging the competitive stance of import-heavy brands.
Customers Reassessing Their Choices
Following the announcement, Bozkurt observed a clear shift in consumer behavior. For years, buyers had a predictable list of brands and models they considered. The regulation, however, has disrupted those routines, leading to a two- to three-week period where customers reassessed their options.
“Everyone analyzed the new picture,” said Bozkurt. “We are seeing that customers are now directing themselves toward models that are more advantageous in terms of taxation.” He added that over the remaining five months of 2025, demand will likely focus on vehicles that fall into lower ÖTV brackets.
Impact on Electric Vehicles
Another key change relates to electric cars. Previously, EVs enjoyed the lowest tax rate of 10 percent, designed to encourage early adoption. However, the revised regulation raises the minimum bracket for EVs to 25 percent. While this is still lower than conventional vehicles, the gap between combustion and electric models has narrowed, making EVs slightly less attractive to price-sensitive buyers.
According to Bozkurt, the adjustment signals a shift in government policy from incentivizing EV adoption solely through tax benefits toward a more balanced approach. He noted that despite this increase, EV demand is expected to continue rising globally and in Türkiye, but the comparative advantage versus conventional models has been reduced.
Commercial Vehicles Maintain Advantage
Bozkurt also highlighted that CDVs, or compact multi-purpose commercial vehicles, continue to benefit from a 15 percent ÖTV advantage. This category, often used by small businesses and families seeking flexible transportation, may see rising demand as buyers evaluate cost-effective alternatives. The continuation of this advantage aligns with Türkiye’s economic strategy of supporting small-scale commerce and logistics sectors.
Significant Pressure on the Pick-Up Segment
The Toyota Türkiye CEO pointed out that the new taxation rules have had the most visible impact on the pick-up segment. With around 16,800 units sold last year across 4×2 and 4×4 variants, this category now faces a sharp rise in cost for heavy-duty work vehicles like 4×4 pick-ups.
For industries such as mining, energy, and distribution—where pick-ups are indispensable—the new rates significantly raise operating costs. As a result, Bozkurt expects the 4×2 versions to dominate future sales, as they are more affordable and still meet practical needs. Toyota, with its well-established Hilux model, is positioned to benefit from this transition.
Toyota’s Record-Breaking Sales Performance
Despite the tax changes, Toyota Türkiye is on track for a record sales year. Bozkurt confirmed that the company expects to sell more than 85,000 units by the end of 2025, surpassing last year’s 61,000. The performance reflects strong demand for both passenger cars and light commercial vehicles, as well as Toyota’s ability to adjust its product mix to align with changing customer preferences.
Bozkurt noted that if additional vehicle allocations can be secured from global production lines, Toyota’s sales may exceed the 85,000-unit milestone. This would mark the highest sales figure in Toyota Türkiye’s history.
Why Demand Remains Strong Despite Rising Taxes
Several structural factors are driving continued growth in the Turkish automotive market:
Population growth and a rising number of individuals reaching car ownership age
Low car ownership rates, with the number of vehicles per 1,000 people still far below European averages
Increased mobility needs, both in urban and rural areas
An aging vehicle park, where many customers are replacing older cars rather than purchasing a first vehicle
Bozkurt emphasized that these dynamics underpin demand even in the face of regulatory changes, ensuring that the overall market remains robust.
A Sector in Transition
The new ÖTV structure represents more than just a taxation update—it signals a restructuring of the automotive market in Türkiye. Domestic production is being incentivized, imports are facing added challenges, and consumer decisions are becoming increasingly complex.
Automakers will need to adapt marketing strategies, revise pricing, and optimize product portfolios to remain competitive. For Toyota, the combination of strong local presence, diverse product offerings, and adaptability positions it well to navigate the changes.
Outlook for the Remainder of 2025
Looking ahead, industry analysts will closely watch how demand distributes across the revised ÖTV brackets. Lower-taxed domestic vehicles are likely to see rising sales, while high-end luxury imports may decline in volume. EV adoption will continue, but at a slower pace than initially anticipated due to reduced tax incentives.
For Toyota Türkiye, the expectation of record-breaking sales underscores both the brand’s resilience and the underlying strength of the Turkish market. As Bozkurt concluded, “We are moving toward a new record, and we believe the future of Türkiye’s automotive industry remains bright.”
