Covidien-19 Effects of Turkey's Defense and Aerospace Industry


The Defense and Aviation Industry sector also got its share from the damage caused by the Corona virus, which spread from all over the world, starting from China. Production, supply, fairs and agreements were interrupted due to the virus that killed thousands of people.

The shocks on the supply side are perhaps the most visible effects of the outbreak's impact on the defense sector. Companies that are dependent on the supply chains in countries affected by the virus or in the affected countries are victims of the virus. In Europe, now known as the center of the virus, serious problems have been experienced. Shipbuilding companies such as Fincantieri in Italy and Navantia in Spain decided to stop many projects. Many defense companies in Europe will experience imbalances in production queues and deliveries due to projects that have decided to stop partially or completely.

Large Defense Companies

The Corona virus, which deeply affected the whole world, also hit the stocks of defense industry giants. There were serious decreases in the stocks of companies such as Lockheed Martin and Leonardo. Shares of some defense companies are trading at their lowest prices in five years. This situation presents a worrying situation. Although it has not yet affected the secondary markets in particular, its indirect consequences may pose serious problems. Companies that plan to issue shares to finance their investments will have to postpone these considerations in the current harmful situation. Another worrying situation for companies is; Some organizations may buy cheap shares, causing loss of control or takeover of some companies. Defense companies may choose to buy back their own stocks to avoid such incidents. However, this situation causes the company to spend more and maybe it is exactly what it needs. zamIt will cause liquidity loss in moments.

Corona Effect in Turkey

The Defense and Aerospace Industry sector is examined by looking at the export figures in the first quarter of 2020. zamAt the moment, it seems that its volume has decreased compared to the previous year. When the month of March, when the virus started to spread in our country, is examined separately, the negative effect of Corona becomes clear.

Looking at the data of the Turkish Exporters Assembly zamWhile the Defense and Aerospace Industry sector was $ 2019 Million in the first quarter of 614.718, this figure decreased to $ 2020 Million in the first quarter of 482.676. If we need to make a comparison between the first quarters of 2020 and 2019, it is observed that there is a decrease of -21.5%. Looking at the data of only March; The export volume in March, which was $2019 million in 282.563, decreased to $2020 million in 141.817. This shows that the rate of change in March between the two years has almost halved, with a figure of -49,8%.

Export Chart
Export Chart

Source: defenceturk

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