The automotive industry is a capital-intensive, high-employment sector of strategic importance in Türkiye’s industrialization process. Since the 1960s, the industry has rapidly evolved from assembly operations to a fully integrated structure with design and manufacturing capabilities. With investments exceeding USD 16 billion by OEMs, Türkiye has secured a strong position in the global value chain—a transformation further reinforced by the launch of domestic electric vehicle production.
At NART Insurance and Reinsurance Brokerage, we analyze both domestic and international risks in the automotive and automotive supply industries, delivering tailored insurance solutions to meet the sector’s specific needs.
Rising input costs (energy, taxes, etc.)
Material and machinery issues
Sudden exchange rate fluctuations
Policy and regulatory instability (including special consumption tax [ÖTV] revisions, carbon emission–focused environmental regulations, ADR regulations, EURO 6 engine requirements, diesel consumption restrictions, etc.)
Potential withdrawal of foreign-based automotive OEMs from the Turkish or European markets
Delays or cancellations in infrastructure investment projects (such as highways, rail systems, or organized industrial zone infrastructure)
Rising labor costs due to COVID-19
Financial contraction and liquidity challenges caused by COVID-19
New investment requirements in parallel with the expansion of electric vehicle adoption
Disruptions in the supply chain
Environmental regulations
Product recalls
Autonomous (driverless) vehicles
Cyberattacks and data breaches
Chemical hazards
In the automotive industry—characterized by its unique and complex set of risks—the presence of effective risk management systems is indispensable for OEM and supplier facilities, as well as distributors and sales offices.
Key Risk Categories:
Natural disasters and fires
Business interruption, strikes, lockouts, and terrorism
Product liability and product recalls
Professional liability
Employee liability
Supplier chain and raw material risks
Environmental risks
Credit risks
Cyber risks
Mergers, acquisitions, and investment-related risks
Occupational health and safety
Risks related to the transportation of products and parts
The automotive sector faces a wide range of both well-known and emerging risks worldwide. A few examples include:
Supply chain disruptions
Environmental regulations
Product recalls
Electric vehicles
Autonomous (driverless) vehicles
Cyberattacks and data breaches
Specific risk priorities vary depending on your position within the automotive supply chain. Automotive manufacturers, vehicle dealerships, and parts suppliers each face distinct challenges.
However, what unites them is the transformative impact of technology. From the way vehicles are manufactured to how they are sold and insured, technology is driving profound and rapid change across every aspect of the industry. This transformation brings with it both new threats and new opportunities for automotive businesses.
Cyberattacks are becoming an increasingly significant concern for automotive businesses. From dealerships handling more customer data than ever before to manufacturers whose operations could grind to a halt if their IT systems were compromised, every stakeholder in the sector is a potential target for malicious hackers.
Moreover, the complex and interconnected technologies integrated into modern passenger and commercial vehicles have created entirely new areas of vulnerability. Cybercriminals now have more pathways to target both automotive companies and their customers.
NART’s cyber risk solutions can play a critical role in strengthening your resilience against such attacks and mitigating the risks they pose.
Product recalls are not a new risk area for the automotive industry; however, they remain a significant source of potential reputational and financial damage.
Large-scale recalls attract substantial media attention and can undermine consumer confidence. The recall process itself, along with potential legal consequences, can have a considerable impact on profit margins.
Technology is also reshaping the nature of product recalls, presenting both new risks and new opportunities for automotive businesses. On one hand, the complex onboard systems of modern vehicles have increased the number of potential issues that may require a recall. On the other hand, addressing a cybersecurity vulnerability through a software update can be far less costly than replacing a physical component of your most popular model.
The automotive industry comprises businesses of all sizes and a wide range of functions. As such, insurance and risk management solutions must be appropriately tailored to meet diverse operational needs.
Essential Global Insurance and Risk Management Services for the Automotive Sector:
Employee-related insurance analysis, loss control, claims and litigation advisory, and placement.
Product recall and liability insurance.
Financial and professional risk analysis, advisory services, placement, and claims advocacy.
Reputation risk and business resilience linked to global supply chains.
Cyber risk advisory, including network security and privacy risk management.
At NART, our automotive solutions draw upon our industry knowledge, global experience, and local expertise to deliver the right insurance and risk management strategies for your business.
