Elon Musk, CEO of Tesla and owner of X, arrives for the Inaugural AI Insight Forum in Russell Building on Capitol Hill, on Wednesday, September 13, 2023.
Tom Williams | Cq-roll Call, Inc. | Getty Images
Turkish President Recep Tayyip Erdogan has extended an invitation to Elon Musk to build his forthcoming Tesla factory in Turkey, as reported by the country’s state media on Monday.
During Erdogan’s visit to the United States for the United Nations General Assembly, he met with Tesla and SpaceX CEO Musk in New York at the Turkish House in Manhattan.
The Turkish state news agency Anadolu reported that Erdogan urged Tesla to establish its seventh factory in Turkey, pointing out Tesla’s existing presence in the Turkish market with the Turkish electric car Togg. Erdogan also offered the opportunity for collaboration between Musk’s SpaceX and Turkey’s space program, as well as an invite for Musk to attend Teknofest, Turkey’s largest aviation, aerospace, and technology festival.
In response, Musk acknowledged that several Turkish suppliers are already working with Tesla and expressed that Turkey is a significant contender for the location of his next factory.
Aerial view of Tesla’s Shanghai Gigafactory on the outskirts of Shanghai, China in July 2021.
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Tesla currently operates six factories worldwide and is in the process of building a seventh in Mexico. Musk previously stated his intention to announce a new factory location by the end of the year. There have also been discussions with Indian government officials regarding the establishment of a manufacturing facility for low-cost electric vehicles in India.
No official response from Tesla has been provided at this time. It is worth noting that the company’s stock price has experienced a 123% increase year-to-date.
The meeting between Erdogan and Musk also involved discussions on potential cooperation in artificial intelligence and SpaceX’s satellite internet service, Starlink. Musk demonstrated interest in obtaining the necessary licensing to operate Starlink in Turkey.
Manufacturing powerhouse
Turkey has emerged as a prominent manufacturing hub at the crossroads of Europe and Asia in recent years.
According to the U.S. Department of Commerce, manufacturing accounts for approximately 19% of Turkey’s GDP, with ambitions to increase this figure to 21% by the end of the year through the implementation of the 2023 Industry and Technology Strategy. This strategy includes initiatives such as state support for entrepreneurs, strengthened intellectual property laws, and significant investments in STEM education and technology startups.
The Department of Commerce reports that 36% of Turkey’s manufacturing exports are medium-tech products, while 3% are high-tech products. The country aims to increase the proportion of medium-tech exports to 44% and high-tech exports to 6% by the end of 2023.
Lithuania exhibited a crowdfunded Turkish-made Bayraktar TB2 combat military drone on July 6, 2022, with plans to provide assistance to Ukraine in its conflict against Russia.
Petras Malukas | AFP | Getty Images
Turkish President Recep Tayyip Erdogan speaks during the launch of the Medium-Term Programme at the Presidential Complex in Ankara, Turkey, on September 6, 2023.
Anadolu Agency | Anadolu Agency | Getty Images
The manufacturing sector in Turkey is projected to invest between $1 to $1.5 billion annually in integrating industry 4.0 solutions into its processes, signifying the country’s commitment to the fourth industrial revolution and digital transformation.
Despite these manufacturing ambitions, Turkey has faced economic challenges, including declining foreign currency reserves and high inflation resulting from President Erdogan’s refusal to raise interest rates. Efforts have been made by the central bank to address these issues, but the value of the Turkish lira remains significantly weakened. Erdogan’s pursuit of foreign investment, such as engagements with Musk and agreements with Gulf Arab states, aims to revitalize the country’s financial situation.
Year-to-date, the lira has depreciated 30% against the US dollar and has experienced a 78% decline over the last five years.
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