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Tesla's Turkey Plans are on spotlight

In May, the billionaire South African announced plans to launch Tesla there by the end of the year. "Love your country and will be there in person," he tweeted. Although Tesla representatives say details on upcoming executive trips to Turkey are not available, Mr Musk may visit while taking in a summit on satellites scheduled for November 1-3 in Istanbul.



Much has changed in the months since Mr Musk's announcement, however. Embroiled in a nascent trade war, the Turkish government in August raised taxes on US-made cars to 120 per cent in response to similar moves by Washington meant to punish Turkey for detaining Andrew Brunson, an American pastor and long-time Turkey resident. Since Mr Musk's announcement in May, the value of the Turkish lira against the US dollar has fallen by 30 per cent, increasing the cost of imports, including Tesla electric cars.


On the surface, Turkey appears to be a market ripe for electric vehicle (EVs) penetration. It already boasts a major car manufacturing industry that employs thousands of skilled workers. It is almost completely dependent on imports of petrol and diesel, which have become increasingly expensive for motorists with the lira diving by 40 per cent against international currencies this year alone. Developing EVs to make Turkey less dependent on foreign energy has been a long-term goal for President Recep Tayyip Erdogan. As such, an alternative source of running its 12 million-strong vehicle fleet, such as Tesla's battery-powered cars, ought to be hugely attractive.


But recent trade conflicts have seen car sales overall decline in the country.


And the political impasse may have damaged Mr Musk's plans. "Because of the trade war there's been a 120 per cent tax on American goods, so if you buy a Tesla, the price is double, then you add tax and on top of that there's 18 per cent VAT," says Cem Gunal, a Tesla S model owner based in Istanbul. All combined, it's a huge sum that's moved Teslas beyond the financial reach of many living in Turkey. This follows Tesla's banning its mobile service technicians from travelling to customers in Turkey following the failed coup by a section of the country's military in July, 2016.


Despite the political wrangling, Mr Musk and Tesla enjoy a cult-like following in Turkey. The CEO's Instagram post from Ataturk's mausoleum in Ankara in November received more than a million likes – more than any other the entrepreneur ever posted on the site. "I usually buy cars that are rare, and my idea was to drive my SUV during the week and keep the Tesla for weekends," says Mr Gunal, a partner at a data protection firm in Istanbul who bought his first Tesla in 2015. "But I soon found that I was in the Tesla all the time." The performance of the Tesla Model S P85D he drives has been described by TechCrunch, a news site, as "absolutely insane".

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