The effects of the COVID-19 global economic crisis on automotive demand: The Turkish case

This study aims to analyze the effects of the Covid-19 Global Economic Crisis on automotive demand with macroeconomic indicators using econometric methods. Two models were used in the study. Passenger car sales and light commercial vehicle sales were used as representatives of supply in the sector in the models. The dataset used in the study includes 61 quarters between 2009Q4-2024Q4. In order to measure the demand effect in the models, passenger car production, light commercial vehicle production, brent oil price, automobile consumer price index, Euro-Dollar parity, real gross domestic product, consumer confidence index, vehicle loan interest rate and pandemic dummy variable representing the Covid-19 crisis were used. In the study, ARDL bounds test was used to determine the relationship between sales and macroeconomic variables. First, Dickey and Fuller (ADF) and structural break (Breakpoint) unit root test were used for stationarity tests of variables. According to the root test results, it was determined that light commercial vehicle sales, light commercial vehicle production, passenger car sales, parity, consumer confidence index and pandemic variables were stationary at the level, brent oil, consumer confidence index, passenger car production, real gross domestic product, and vehicle loan interest rate variables had a unit root and their first differences were stationary. ARDL bounds test was used to determine the cointegration relationship between the series. According to the short and long term coefficient results; It was concluded that oil prices, automobile production, consumer price index, gross domestic product, consumer confidence index and pandemic variables increased passenger car sales, while increases in parity and interest rates decreased sales. It was concluded that increases in oil prices, light commercial vehicle production, consumer price index, parity and pandemic decreased light commercial vehicle demand, while increases in gross domestic product increased demand. Inferences were made regarding the relationships between the variables with the findings obtained in the study. Keywords: Pandemic, Automotive Sector, Demand, ARDL Cointegration