Tofas shares tumble in Turkey as new Fiat Doblo to be made in Spain (updated)

Tofas Turk Otomobil Fabrikasi

07/06/2022 12:11

(Adds comment, detail, background)
    By Can Sezer
    ISTANBUL, June 7 (Reuters) - Shares in Turkish automaker
Tofas  TOASO.IS  fell sharply on Tuesday after its major
shareholder Stellantis  STLA.MI  said the new Fiat Doblo will be
produced in Spain, creating uncertainty about what will be
produced in its place in Turkey.
    The shares slid 6.1% to 73.95 lira by 1025 GMT, off an early
low of 72.85 lira.
    Tofas is a joint venture of Turkey's Koc Holding  KCHOL.IS 
and Stellantis, which was formed in 2021 through the merger of
France's PSA and Fiat Chrysler.
    Tofas previously said output of the Doblo light commercial
vehicle would continue at its factory until end-2022. But it
said late on Monday that assessments were continuing on
extending the current Doblo version output until end-2023 and on
the potential production of new models.
    A Stellantis news release on Monday about the new Doblo and
E-Doblo vehicles said these would be manufactured in Spain.
    Tofas began production of the Doblo, one of the three main
vehicles it makes, in the early 2000s and it enabled the company
to switch to an export-oriented business model.
    While Doblo production by Tofas was originally planned to
end at the end of this year, Stellantis has been evaluating for
some time whether Tofas would produce the new model. 
    "We still see a higher probability that there will be new
potential projects... However, current news flow does not look
very encouraging," said Ata Yatirim deputy general manager Cemal
Demirtas.
    "Any delay in the announcement of new potential projects...
is likely to lead to an overhang in Tofas shares."
    Tofas said even if Doblo production in Turkey is extended,
European countries will not be among its main export markets,
with output focused on the domestic market, the Middle East,
Africa and North America markets.
    Doblo constituted one third of Tofas' production with 77,520
vehicles as of the end of last year. It also made up 43% of the
company's exports with 48,761 units.
    Aside from the Doblo, Tofas produces the passenger model
Egea and another light commercial vehicle platform, the MCV, in
smaller volumes.
    Tofas has a production capacity of 450,000 a year, but
output decreased after the coronavirus epidemic. It produced
about 229,000 vehicles last year.    

 (Reporting by Can Sezer
Writing by Daren Butler
Editing by Jonathan Spicer and Jane Merriman)
 ((daren.butler@tr.com; +90-212-350 7053; Reuters Messaging:
daren.butler.thomsonreuters.com@reuters.net))