As was true the year before, 2021 was overshadowed by circumstances that posed numerous challenges for both our own country and for the world. The coronavirus epidemic, volatile markets, geopolitical developments, and resurgent inflation brought on by a global recovery as well as the impact of all of this on our country affected us both economically and operationally. Although the resilience of companies in every sector was put to the test by supply-chain difficulties, problems related to procuring microchips posed particular hardships for automotives manufacturers and occasionally led to production stoppages in the course of the year.

Under such tough conditions of overarching uncertainty and in view of the need to deal with a pandemic, we nonetheless succeeded in ensuring the continuity of our business operations while prioritizing the health of our employees and all our other stakeholders thanks to our experience of managing rapid changes in the best way possible.

FIAT IS THE ENDURING LEADER OF THE DOMESTIC AUTOMOTIVES MARKET

Our company’s production in 2021 represented 17% of its sector’s output and 12% of its exports while 97% of the company’s sales to its home market consisted of domestically-manufactured goods.

With our strong mix of automobile and light commercial vehicle brands and models, we achieved market shares of 13.1% and 27.4% in automobile and LCV sales respectively. By commanding a 16.9% share of all automobile and LCV sales in Turkey 2021, our Fiat brand handily defended its leading market position for the third year in a row.

The Fiat Egea remained Turkey’s most popular automobile in 2021, a distinction that it has enjoyed ever since we began producing it in 2015. The Egea family’s newest member–the Egea Cross–has become the second most popular automobile in the family and was also designated “Automobile of the year in Turkey” by the Automotive Journalists Association.

Our efforts to expand the Egea family continued in 2021 and an Egea Cross Station Wagon model was launched at the beginning of 2022. We are very near the completion of preparations to begin selling versions of the automobiles in this family equipped with automatic transmissions.

Turning now to light commercial vehicles: our Fiat Professional models have all maintained their market positions while the Fiat Doblò became the country’s most popular LCV in 2021.

Last year our company also further strengthened its competitive market position with the introduction and sale of hybrid Fiat 500, Fiat Panda, Jeep® Renegade, and Maserati Levante models in 2021.

Looking now at our 2021 financial performance: Tofaş’s 2021 revenues were up by 26% year-on and weighed in at TL 29,684 million while its net profit shot up by 83.9% to TL 3.3 billion during the same twelve-month period.

WE CREATE ADDED VALUE THROUGH R&D

Playing an important role in the conduct of product-development projects on a global scale, the Tofaş R&D Center also creates added value for Turkey’s economy, industry, and R&D know-how. Our center enjoys a commanding position among Stellantis Group R&D facilities by virtue of its product-engineering experience, its new-product development competencies, and the diverse capabilities of its high-tech laboratories.

During 2021 the Tofaş R&D Center worked intensively on projects related to the development of the Egea Cross Station Wagon and to the improvement of our Fiorino series. It also supported R&D projects undertaken by other Stellantis Group companies. The number of EU research projects in which the center has taken or is taking part reached 29 as of end-2021. Our R&D operations generated 39 new patent applications last year.

Tofaş placed second in the “R&D: Big R&D Centers” category in the 2020 round of the R&D and Design Centers Performance Index Awards handed out every year by the Turkish Ministry of Industry and Technology. Tofaş remains the only automotives company to make it into this ranking. In Turkishtimes’ “R&D 250” survey of companies in Turkey ranked according to their R&D expenditures, Tofaş placed among the top three firms as measured by their R&D outlays.

Under the Tofaş Digital Transformation Program, smart-factory projects to improve productivity through digital optimization are being accelerated, investments in the development of remote-working, 5G, cloud, cybersecurity, and similar IT projects as well as in data-driven analytics are continuing, and additional impetus is being given to the roboticization of basic infrastructural and core operational processes.

In our efforts to incorporate digital competencies into our sales and after-sales processes so as to improve the customer experience, all Fiat-badged automobiles are now being offered for sale through our Fiat Online channel. Through My Fiat Companion Connect, the most all-embracing vehicle connectivity technology available in our country today, we provide our customers with value-adding services such as vehicle security and smart comprehensive coverage.

HUMAN RESOURCES ARE OUR MOST IMPORTANT ASSET

Regarding its employees as its most important asset, Tofaş determines all of its HR processes and policies in line with the principles of inclusiveness, equality, and diversity while also providing its personnel with a safe and healthy workplace environment.

Tofaş-developed innovative learning and technology-deployment solutions have earned the company a total of four awards: three gold in the Stevie Awards for Great Employers series and one bronze in recognition of its Covid-19 practices.

WE ARE FOCUSED ON CREATING VALUE FOR A SUSTAINABLE FUTURE

Tofaş shares continue to be included in the BIST Sustainability Index in acknowledgement of the company’s sustainable value-production model and practices. The company also strives constantly to improve its environmental, social, and governance performance.

The company is engaging in accelerated efforts to support circular-economy practices and the transition to a low-carbon economy. In the end-to-end conduct of all procurement and production processes, it seeks not only to reduce their environmental impact, to responsibly use and conserve energy and other resources, to increase productivity, and to reduce process waste to zero but also to make such performance-enhancing improvements as may be required. In the conduct of its R&D operations, Tofaş supports product-electrification projects in line with Stellantis’s strategies and new-product development efforts.

Demonstrating its contributions to society in a variety of ways, Tofaş focuses on social-responsibility projects capable of generating added value for the country’s economy and society. To this end, it undertakes long-term projects in the areas of investing in future generations, promoting inclusiveness and diversity, and protecting the cultural heritage.

TOGETHER WE CAN ACHIEVE MANY MORE SUCCESSES…

Despite all of the challenges with which it had to contend in 2021, the Tofaş family completed the year and sustained its performance by dint of its determination, exertion, and outstanding effort.

In the period immediately ahead our main goals as Tofaş will be to further advance the customer experience through the deployment of our experience, employees, and production and R&D competencies; to invest both in employees’ acquisition of essential next-generation competencies and in issues pertaining to our environmental impact; to reinforce our leading position in Turkey; and to enhance our presence and effectiveness in the Stellantis landscape.

Besides continuing to maintain our commanding presence in all market segments through a wide range of brands and products that satisfy customer expectations, we will also bolster our competitiveness by working together even more actively with dealers and suppliers, by strengthening our approach to superior-quality, fast, and flexible service delivery through the use of digital technologies, by developing new mobility solutions, and by undertaking new investments in connectivity.

Tofaş holds that production sustainability nourished by its corporate values is compatible with a sustainable future. I believe that this attitude is capable of carrying us forward towards many more successes. In closing I would like to thank our shareholders, employees, customers, dealers, suppliers, and all other stakeholders for their support and contributions towards those successes.

Cengiz Eroldu
Board Member & CEO