Türkiye is a young and growing country marked by conflict in neighbouring countries and economic instability at home. Such challenges drive the country to seek solutions through innovation and deal-making in the Turkish battery industry. Andrew Draper reports.
Türkiye stands in a unique position, partly due to its geography – where Europe, Asia and the Middle East meet – but also because of its ability to survive and thrive in a challenging region marked by economic instability and military conflict.
Abdurrahman Acar, chairman of the Accumulator and Recycling Industrialists Association (Aküder), told BEST its 267 members focus on quality and cost-efficiency, as well as innovation. They cover lead-acid battery manufacturing, importing lead-acid, lithium and nickel batteries, waste battery temporary storage and recycling.
The country has a substantial automotive manufacturing sector and so puts Türkiye in a critical position in the global battery supply chain. Growth of the automotive and motorcycle sectors (in response to urban congestion) has significantly boosted battery demand, strengthening the domestic market potential, he said.
National statistics body Turkstat puts the number of registered vehicles at 31 million and rising in November 2024. Industrial expansion and the widespread use of handling equipment are key factors driving demand for industrial batteries, Acar said.
He said Türkiye’s role as a logistics hub between Europe, Asia and the Middle East has become even more critical following crises in routes like the Suez Canal. “The tax and logistics advantages offered by Turkish ports and free trade zones bolster its position in the global battery supply chain.”
But significant challenges loom, he said. “Global supply chain disruptions and critical raw material shortages increase production costs and hinder export competitiveness. Inadequate infrastructure for electric vehicles, particularly the lack of charging stations, is another factor limiting growth. Additionally, anti-dumping duties imposed by Gulf countries on motor batteries pose a major obstacle in these export markets.”
Conflicts in neighbouring countries such as Syria, Iraq and Israel-Palestine have complicated export activities and accelerated efforts to explore new markets, he said. “As Aküder, we support our members in mitigating risks and maintaining trade balance by encouraging a focus on African, European and Central Asian markets.”
Association members, including recyclers, are investing in optimising production processes, digitalisation and new technology to enhance operational efficiency, he said.
The Ministry of Industry and Technology’s 2030 targets include a 75% localisation rate in EVs and increasing their market share to 35%. Domestic projects like TOGG (Türkiye’s Automobile Initiative Group) have accelerated lithium-ion battery production and boosted sector momentum. This facilitates meeting domestic demand while gaining a competitive edge.
The growing electrical consumption needs of modern vehicles are driving demand for advanced battery technologies such as AGM and enhanced flooded batteries. “In conclusion, electrification, renewable energy, digitalisation and environmental sustainability are the main trends driving the growth potential of Türkiye’s battery market…
“We anticipate the sector will gain momentum in adapting to global transformation, particularly through increased investments in electric vehicles and renewable energy systems,” he went on. “Additionally, the expected rise in regulations focusing on recycling and environmental sustainability will make circular economy practices more prevalent in the industry.”
A hot region
Battery equipment manufacturer Batek Makina is adept at operating in a hot region surrounded by war, sanctions and geopolitical tension.
Celal Saricam, vice-president of sales, told BEST that Türkiye is surrounded by war and conflict on all sides – Russia and Ukraine to the north, Israel’s wars to the south and its neighbour Iran to the east facing international sanctions. Since he spoke with BEST, armed conflict and insurrection broke out in Syria and there is social unrest in Georgia.
“We are somewhere that’s a very hot region,” he said. “But we became a bit adapted to that situation. Of course, on the supply side, there are some constraints, but it’s not deeply affected, at least in the battery industry or let’s say the manufacturing industry is not that badly affected.” Russia and Iran used to be big markets and now are almost zero due to international sanctions.
President Donald Trump warned he would introduce tariffs on imports from Mexico, Canada and China from day one of entering office, and the prospect of a trade war is creating uncertainty at Batek and elsewhere.
But Saricam notes a silver lining: “Trade wars actually trigger local manufacturing. This is not a bilateral war, this is a multilateral war. If somebody pulls the trigger, the others also will not stay idle. They will also pull the trigger. So if everybody pulls the trigger, then every country will have its own barrier.”
While it would push up costs for consumers, it would mean more countries deciding to establish battery factories and each needing to buy manufacturing equipment. “Now consumers will have to buy much costlier goods. But for manufacturers, this is a paradise,” he said.
New project every year
Batek spends around 2% of its annual revenue on R&D, according to Saricam, and aims to develop a new project every year. It may be a version of something already in existence, but it eventually becomes a new product. While the company was established around 2002, its three partners have been in the business for almost three decades.
The company specialises in making assembly equipment for lead-acid batteries for south Asia, but taking in everywhere in between including north Africa, the Middle East and South America.
Asia and South America have great technological growth potential for Batek, he said. It specialises in complete turnkey projects which can take nine months to build. It delivers six or seven per year. They include complete battery assembly lines, automation systems, robotic applications, design and supply of tools for battery manufacturing.
Gone are the days when a manufacturing company could sell some equipment and largely forget about it and move on to the next job. Nowadays, customer service is king, and maintaining and servicing supplies for years after the sale is essential. Batek has taken on extra customer service staff to do this.
He foresees the day when companies like his make up a digitalised service industry that can be fulfilled by retailing giants like Amazon.
Entire battery lines
Battery equipment supplier Zesar celebrates its 50th anniversary in 2025. It has gone from providing grid casters to battery makers in Türkiye to now assembling and supplying entire battery line manufacturing equipment to customers worldwide.
Ahmet Yavuz Sariçam, Zesar’s general manager and son of the late founder Zeki Sariçam (after whom the company name Zesar is derived) told BEST turnkey solutions mean everything in battery production. It combines equipment producers from Europe, Türkiye and Asia, proposes solutions and then kits out newly establishing factories when orders are won.
He said Zesar typically makes half the equipment it sells itself, with the remainder provided by external suppliers. Its focus is on AGM lead batteries and prides itself on its watered production formation equipment and curing chambers, which are in popular demand.
Like many others, Zesar is putting a lot of effort into round-the-clock customer service. It aims to come up with solutions for its customers with remote troubleshooting, or with a customer visit if required.
Sariçam said every Turkish battery company has had dealings with Zesar. “If you are talking about battery production in Türkiye, you cannot omit Mr Zeki in this history,” he said in reference to his father, who died in 2020. Zeki Sariçam started manufacturing moulds for battery manufacturing in the 1960s and went on to found Zesar.
Its first turnkey project was delivered in 2014 and a year later the company invested in a new factory in Manisa, Türkiye. A new plant was established in Manisa in 2021 with 6,000m2 of floor space.
It is now engaged in making equipment for plate production – from paste production to grid casting and curing chambers – assembly and finishing lines. Formation solutions include battery formation water baths as well as acid and gel-filling machines.
Zesar counts 80 customers in 33 countries. They are mainly in the Middle East, but are also to be found in South America, Africa, the Balkans, Russia and Asia.
Surviving conflict
The company is used to managing business in areas hallmarked by conflict. “Of course we have troubles, but we are used to surviving with those troubles,” he laughs. “I am in the market and have been in sales for the last 21 years. When I lost my father, I became general manager and passed all sales to the sales team.
“And I know the market. I know everyone and everyone knows me. I’m not new in the market, I’m not a freshman. And trade in the Middle East market, you know we find ways to make trade, to make business.”
The company spends around €5 million ($5.3 million) a year on R&D, which also attracts government subsidies. It is currently working on AGM acid filling in anticipation/recognition of AGM batteries taking prime place in the lead battery market. It has developed curing chamber design in conjunction with universities and is trying to make curing faster and operate with high capacity and acceptable operating times.
Sariçam said the Turkish market for lead batteries is not growing (in fact Zesar saw a decline in 2024), as it faces tough competition from lithium-ion batteries, which are drawing increasing investments. But the focus on AGM batteries continues to grow, he said.
Export markets are performing much better for Zesar, especially in Asia, according to Sariçam. The reasons are hard to determine but he notes high energy costs in Europe have been a factor.
Mutlu Akü offloaded
The challenging nature of the Turkish market, with high interest rates and rampant inflation, does not suit everyone.
Battery company Mutlu Akü was sold by its parent, South African industrial company Metair, in December. Mutlu makes a range of lead-acid and lithium-ion batteries.
Paul O’Flaherty, Metair CEO, told BEST the decision to divest was influenced by a combination of factors, primarily strategic in nature. “Türkiye’s current economic landscape poses significant challenges, with high inflation, and our strategic focus is shifting towards growth opportunities in Africa, where we see great potential for expansion,” he said.
Operating in Türkiye has become increasingly complex and challenging due to several macroeconomic factors, he added. Inflation is running at approximately 75% and interest rates are at around 50%. “These factors have created an unpredictable environment, leading us to reconsider our strategies within the region.”
The OECD think tank said in its December economic outlook that inflation is easing but remains high.
Metair’s sale of the Mutlu Group to Quexco Inc. previously received the requisite shareholder approvals and the Turkish Competition Board confirmed no further consent was necessary.
Metair was expecting to close the transaction before the end of 2024. Certain Mutlu Group companies needed a new financing agreement with Turkish banks.
Disposal price was $110 million, according to Metair. Mutlu Group’s debt and accounts payable had increased substantially since September as a result of the requirement to fund operations with hyperinflation and high interest rates. Metair was expecting no more than net proceeds of $5 million to be realised. Mutlu was accounting for 73% of its interest costs and 23% of net debt.
BESS market drivers
The Turkish market for battery energy storage systems (BESS) is being driven by four main demand trends, according to consulting firm PwC:
- growing capacity for renewable energy
- increasing demand from industry
- the proliferation of electric vehicles and need for electricity
- electricity distribution pilot projects from BESS.
Referring to the energy ministry’s latest energy plan, it expects non-hydro renewable energy capacity to hit 80–90GW in 2035, amounting to some 45–50% of overall installed electricity capacity. The plan envisages 7.5GW of battery capacity in 2035.
Energy targets, increasing competition and import dependency on lithium-ion batteries are the main supply trends.
It said 2,700 applications were made for the 160GW of capacity available for storage licenses.
PwC believes there will be over 20 BESS suppliers operating in the Turkish market by 2032, with annual sales volume of $4–500 million.
In January, Rolls-Royce announced the awarding of a contract by Polat Enerji, one of Türkiye’s leading investors in renewable energy. It will supply a 132MWh BESS. The EnergyPack will be integrated into the Göktepe Wind Power Plant near Yalova in north-western Türkiye and will feed into the grid without interruption. It will be controlled by the mtu EnergetIQ intelligent control platform.
Rolls-Royce Solutions Turkey has been providing products and services for 35 years. It has its own nationwide service network for all industries in which Rolls-Royce Power Systems operates.
Regulation
London-based Lower 48 Energy, a BESS development company, points out that storage license regulation, approved by the Turkish parliament in July 2022, has accelerated the BESS market growth in Türkiye.
The regulation allows BESS operators to obtain pre-licenses for solar or wind power plants – without the need for competitive auctions, as long as they do not exceed the established BESS capacity limit, it said. BESS operators also have the option to sell their electricity on the EPİAS energy market at market clearing prices or under the feed-in tariff scheme known as Yekdem.
In July 2024, the government introduced a $30 billion investment programme of incentives for EV, battery, semiconductor and energy technology investments. Analyst house S&P Global said this is aimed at boosting the country’s technology profile as an energy hub. The programme included a $4.5 billion incentive package to attract battery production investments to reach 80GWh of battery production capacity by 2030.
Investors have included China’s BYD, which signed a $1 billion investment agreement for an EV and hybrid manufacturing plant in July.
China’s Ganfeng Lithium Group announced an agreement in August with a Turkish battery producer to set up a $500 million joint venture for lithium battery production.
Jiangxi Ganfeng Lithium Battery Technology and Turkish top lead-acid battery producer Yiğit Akü plan to build a 5GWh/annum production lithium battery plant in Türkiye, according to a Ganfeng filing to Shenzhen Stock Exchange.
Türkiye might face considerable challenges in its battery industry, but has found a way of meeting and getting around them.
