This article first appeared on GuruFocus .
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Revenue:TRY427 billion in the first half of 2026, down 12% versus the inflation-adjusted prior year base.
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Export Revenue:TRY359 billion, representing 84% of total revenue (up from 82% last year).
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Domestic Revenue:TRY68 billion, down 21%.
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Gross Profit:TRY29.3 billion, down 28% year over year.
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Operating Profit:TRY11.6 billion, down 56%.
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Adjusted EBITDA:TRY25.6 billion, down 37%.
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Adjusted EBITDA Margin:6.0%, down approximately 2.4 percentage points.
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Adjusted EBITDA per Vehicle:EUR1,438, down from EUR1,839 last year.
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Net Income:TRY10.3 billion, down 40%.
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Profit Before Tax:TRY10.2 billion, down 52%.
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Gross Margin:6.9%, down approximately 1.6 percentage points.
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Operating Margin:2.7%.
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Net Margin:2.4%.
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Net Financial Expense:TRY16.4 billion, improved by 38%.
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Net Debt to Adjusted EBITDA:1.76 times, up from 1.49 times at year-end.
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Net Cash from Operating Activities:TRY19.2 billion, down from TRY78.7 billion in the prior year period.
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Capital Expenditure:TRY8.3 billion, down 35% year over year, representing 1.9% of sales.
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Free Cash Flow:Positive at TRY10.9 billion.
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Domestic Sales Volume:Declined by 24% in the first half.
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Export Sales Volume:Declined by 4% year over year to 293,000 units.
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Production Volume:Decreased by 3% year over year to 341,000 units.
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Capacity Utilization:73% overall, with 70% in Turkiye and 79% in Romania.
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Commercial Vehicle Market Share (Turkiye):24.6%.
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Overall Market Share (Turkiye):6.6%, ranking fifth.
Release Date: August 04, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Ford Otomotiv Sanayi AS ( FOVSY ) maintained its leadership in the Turkish commercial vehicle market with a 24.6% market share and remained Europe's leading commercial vehicle brand for the 12th consecutive year.
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The company completed the acquisition of Koc Finansman, expanding its financing capabilities and enabling a more integrated end-to-end value proposition, with benefits expected from Q3 2026 onwards.
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The board approved a EUR364 million investment in the Ford Trucks New-Cab project, supporting long-term growth, EU regulatory compliance, and entry into the UK market, while also enabling utilization of project-based state aid.
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Despite challenging conditions, Ford Otomotiv Sanayi AS ( FOVSY ) maintained a disciplined balance sheet with net debt-to-EBITDA at 1.76 times, well below its 3.5 times threshold, and generated positive free cash flow of TRY10.9 billion.
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The company demonstrated resilience in export volumes, producing vehicles equal to 15% of Ford's global sales, and maintained stable cash conversion cycle at 17 days with improved receivable days.
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Ford Otomotiv Sanayi AS ( FOVSY ) is actively pursuing a balanced VECTO compliance strategy for heavy trucks, focusing on zero-emission technologies and diesel efficiency, which reduces regulatory compliance risk in Europe.
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The company is implementing proactive measures to improve second-half profitability, including mix management, cost reduction actions, and enhanced variable marketing, targeting an adjusted EBITDA margin of 6-7% for the full year.
Negative Points
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Ford Otomotiv Sanayi AS ( FOVSY ) experienced a significant profitability decline, with adjusted EBITDA margin falling to 6.0% from 8.4% in the prior year, and adjusted EBITDA per vehicle dropping to EUR1,438 from EUR1,839.
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The Turkish market environment remained challenging, with inflation (18%) outpacing EUR/TRY appreciation (5%), creating a substantial headwind for revenue growth and cost structure.
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Domestic wholesale volumes declined by 18% due to weaker market conditions and intense price competition, leading to a market share drop to 6.6% and a fifth-place ranking.
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Export sales decreased by 4% year-over-year to 293,000 units, with softer-than-expected demand in key European markets like Germany, France, and Italy, and a normalized Ford market share of 15.5%.
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The company faced a timing mismatch in export sales, with a larger share of volumes recorded during periods of limited EUR/TRY appreciation, adversely affecting export revenues and other operating income.
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Ford Trucks operations were heavily impacted by high local content (90% localization), making them more vulnerable to inflation and the unfavorable FX-inflation gap, leading to reduced pricing competitiveness.
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The company revised its domestic retail volume guidance downward to 75,000-85,000 units and reduced its Turkish industry forecast to 1.2-1.3 million units, reflecting a cautious outlook for the remainder of the year.
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Net cash from operating activities declined sharply to TRY19.2 billion from TRY78.7 billion in the prior year, due to lower profitability and a working capital outflow.
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The company faced a temporary hold on some MCV stock due to quality checks, which negatively impacted sales and stock positions during the period.
Q & A Highlights
Q: Can you explain the profitability decline? Was it entirely from the entrepreneurial business, or did the contractual business with Ford Motor Company also contribute? A: Unal Arslan (Corporate Finance Leader) clarified that the decline was not entirely from the entrepreneurial business. While the entrepreneurial side (Turkish domestic sales and Ford Trucks exports) faced significant pressure, the contractual business also had an impact. The key issue is the divergence between the EUR/TRY appreciation (14%) and inflation (32%). Since export revenues and profits are converted to Turkish lira using the euro exchange rate, the lower-than-inflation euro appreciation creates a translation headwind, reducing reported revenue and profit in TRY terms despite the cost-plus nature of the contracts.
Q: Given that over 80% of revenues are from cost-plus export contracts with Ford, why was there such a big swing in gross margin? Are there any waivers on the export contracts that could be reversed in the second half? A: Gul Geriskovan (CFO) stated that Ford Motor Company honors its contracts, and there are no waivers or changes to the contract structure. The gross margin pressure stems from the macro environment, specifically the gap between inflation and EUR/TRY appreciation, which impacts the translation of euro-denominated profits into Turkish lira. The company is focused on managing incurred costs better rather than renegotiating contracts, as the contracts are clearly defined on a vehicle-line basis and are honored by Ford.
Q: European demand is picking up, but Ford is losing market share. What are the main reasons, and will this reverse in the second half? A: Gul Geriskovan (CFO) explained that the market share normalization from 17.2% to 15.5% is expected and not an anomaly. The Volkswagen partner units from the 1-ton project are now entering the market with their full portfolio, which was anticipated. Since Ford Otosan produces these units as well, this is not viewed negatively. The company expects the market share to settle at a normalized level, and the production plans are in line with projections.
Q: The Truck segment has seen declining volumes and low capacity utilization. Is this cyclical or structural, and when will recovery occur? Can you provide EBITDA figures for the Truck segment? A: Gul Geriskovan (CFO) noted that the company does not report segment-level details, but the Truck business is facing significant headwinds from new EU regulations (VECTO) and high local content costs. The company is investing heavily in the next-generation cab project with Iveco to ensure compliance and competitiveness. While per-unit investment costs are high, this is a strategic necessity for long-term growth. The entrepreneurial business, including Trucks, was more adversely affected this period, but the company is taking measures to improve profitability.
Q: How will the Koc Finansman acquisition impact leverage and net debt/EBITDA? Are you considering a new Eurobond issue? A: Unal Arslan (Corporate Finance Leader) explained that Koc Finansman's debt and EBITDA will be excluded from the consolidated net debt/EBITDA calculation for covenant purposes, as it is a financial services business. The acquisition cost of approximately $130 million will have a minimal impact of around 10 basis points on Ford Otosan's standalone leverage. Gul Geriskovan (CFO) added that the funding for the acquisition is already secured, and while a Eurobond issue remains an option, there are no immediate plans.
Q: There are reports of power shortages in Romania causing a plant shutdown until August 19. Can you provide details and the financial impact? A: Gul Geriskovan (CFO) clarified that the reports are incorrect. The Craiova plant shutdown from August 1 to August 19 is a pre-announced, normal maintenance period, similar to the shutdown in Turkiye. The power shortage issue relates to a nuclear plant in Cernavod?, which is far from Craiova, and is unrelated to Ford Otosan's operations. The company expects no impact on production or financials from this issue.
Q: Your guidance implies a recovery in the second half, but Q3 started weak with July domestic demand down 25% and August being a break period. What is the basis for this recovery? A: Gul Geriskovan (CFO) stated that the recovery is based on deliberate actions, including better sales mix management (product and retail/fleet mix), enhanced cost reduction measures, and improved vendor capacity for certain derivatives like plug-in hybrids. The company also expects macro conditions to normalize, with easing inflation and interest rates. While there are risks from geopolitical uncertainties, the company's projections are based on a plausible normalization scenario, and they are targeting improved profitability through better volume and mix management.
Q: Do you have an update on the "Made in EU" proposal? A: Gul Geriskovan (CFO) said the company is actively lobbying for a "Made with EU" concept, which would be a win-win for all parties. The company is working with Turkish authorities, European institutions, and industry associations to highlight the value created in Turkiye. The draft is expected to be updated until December 2026, and the company is confident that common sense will prevail, given the customs union agreement and the mutual benefits.
Q: Has Romania's performance been better than Turkiye's, and has its contribution to consolidated figures improved? A: Gul Geriskovan (CFO) confirmed that Romania's operating environment is more stable than Turkiye's, with less volatility and complexity. As long as volumes and the RON/EUR relationship remain in line with projections, Romania's performance is more straightforward. However, there are some political and currency risks in Romania that are being monitored, but they are not as significant as the challenges in Turkiye.
Q: Do you expect pricing pressure in the Turkish market to continue into 2027? Are you evaluating any capacity expansions or new model allocations? A: Gul Geriskovan (CFO) expects pricing pressure to continue through 2026 and into 2027 due to softening demand and ample vehicle availability. However, as inflation and interest rates ease, the environment may improve. Regarding investments, the major investment cycle with Ford is largely complete, and the company is now focused on the significant Ford Trucks investment. There are no new capacity expansions or model allocations to share at this time.
Q: Can you walk me through the logic of improving second-half revenue growth
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
