The effect of oil prices on automobile sales on account of engine volumes in Turkey

The oil prices have a crucial importance in Turkey. The large part of oil demand is satisfied by importation in Turkey, as a result of low oil production of the country. In this present study, we have researched the effect of oil prices on automobile sales in Turkey. In the model of demand of car sales, the variables that have an impact on demand, has been analyzed within panel data analysis method by taking engine volumes into consideration. The number of car sold in 2011 has been analyzed and explained within the scope of average automobile sale prices, per capita income, oil prices, real exchange rate index, and the amount of lagged cars. Three different models had been analyzed using the same variables for three different fuel types in purpose of determining the effect of oil prices on automobile sales. On the second step, the models, which are suitable with data, were decided, after assumptions has been tested and by this way we have reached the resistant standard deviation. At the last chapter of the research, the individually effects of gasoline, diesel and liquid petroleum gas prices on car demand in Turkey are discovered. Keywords: The number of cars sold, oil prices, panel data regression, Turkey