Hello, as you know, as we enter 2026, EU countries have started to implement the Border Carbon Adjustment Mechanism (CBAM). In this article, I will evaluate how ready our automotive industry is for implementation. We can happily say that the Turkish automotive industry is one of the sectors most prepared for the Border Carbon Adjustment Mechanism (CBAM) process. Our automotive industry is not actually a direct CBAM industry.
However, it is indirectly but strongly affected by this mechanism through the main inputs it uses (iron-steel, aluminum, carbon-fiber, etc.). The numerical and strategic situation regarding the financial liability period that begins when we enter 2026 is briefly as follows: 1. Numerical Size and Carbon Intensity The Turkish automotive main industry has achieved a serious increase in productivity, especially in the last 4-5 years.
According to Automotive Manufacturers Association (OSD) data: Emission Reduction: In the last 4 years, the sector has been able to reduce greenhouse gas emissions per light vehicle production by 1, and in other vehicle groups by U. Carbon Per Production: In OSD’s Sustainability Report in 2022, the carbon footprint value per ton of light vehicle production was given as approximately 4,669 kg CO2. Approximately 1% of this comes directly from the use of steel.
Revenue Loss Forecast: The risk of revenue loss in the automotive industry is expected to remain at a lower level (between 0.7% and 1.2%) compared to other sectors. However, this rate will depend on the extent to which the carbon cost of iron-steel and aluminum in the supply chain will be reflected in the cost of light vehicles. 2. Preparation Level of the Sector The automotive industry, which is the export leader of our country, stands out as the sector that adapts to the standards fastest, as it works under the main centers (OEM) in the European Union.
To briefly list the steps taken during the harmonization process: Our Sub-Industry: EU-based main manufacturers have already obliged our domestic suppliers to report and reduce their carbon emissions in line with the 2030 and 2035 emission targets. Reporting Competency: Almost all of the main industrial companies in the sector and large suppliers (TAYSAD members) have started to regularly report their Scope 1 and Scope 2 emissions.
Renewable Energy: Most of the automotive production facilities in our country have completed their rooftop SPP (Solar Power Plant) investments and I-REC (Green Energy Certificate) procurement in order to avoid carbon tax. 3. Critical Risks and Challenges Although the main industry seems ready, the following structural challenges stand before us: Indirect Cost: Although CBAM is not directly applied to the light vehicles we produce, the carbon cost per ton of steel we export to the EU (based on current carbon prices) seems to create an additional cost per vehicle we export.
Scope 3 Complexity: Expanding the scope of CBAM after 2026 to include “indirect emissions” (electricity consumption, etc.) more strictly may challenge our suppliers in the medium-sized SME category. Recycling: Although the waste recovery rate in the sector has increased to over 100,000, access to raw materials such as green steel and green aluminum is still limited and expensive. In short, our automotive industry is technically and operationally ready for CBAM at a “High” level.
However, maintaining its competitiveness depends on Turkey implementing its own National Emission Trading System (ETS) as soon as possible and ensuring that the carbon taxes to be paid at the border remain in Turkey instead of the EU.
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