How is your company positioned in Turkey and in the world?
Cummins is an American company, which operates with 48,000 employees in more than 190 countries with a turnover of 17.3 billion USD as of the end of 2013. It was ranked 150th on the Fortune 500 list in 2012. Cummins has eight business divisions, the main line of business being the production of engines larger than 2.8 liters of volume as well as the supplementary products of these engines.
As of May 2014, there are 130 employees employed in our factory in the Aegean Free Zone, of which 103 are regular Cummins staff. We currently manufacture air and fuel filters in our two production lines. We also provide service to both after sales and OEM customers.
Can you give an overview of the development of your company since its inception?
The groundbreaking ceremony of our company took place on May 6, 2012. We recruited our initial group of employees on June 1, 2012. After training a team of seven people at our facilities in the U.S. and France for 1.5 months, we continued recruiting to further grow our team. In parallel, an international project team was created. We spent eight
months with this group for construction of the factory in Izmir, laying out the legal infrastructure of the company, designing and implementing the operational processes in compliance with the processes of Cummins and local regulations, as well as setting the IT infrastructure.
We started manufacturing on our first line in April 2012 and shipped our first set of products in May 2012. At the end of 2012, we established our second production line for fuel filters. We can say that 2011 was the year of legal and operational infrastructure establishment, 2012 was the start of operations and 2013 was the year of activating the factory’s operations in full capacity. In 2014, we are focusing on continuous improvement and sustainability projects as well as adding new businesses to our existing production lines. We are also working on two new lines; one to be activated in 2015 and the other in 2016.
Can you review the production, employment and investment data of your company?
We produce 540 thousand air filters and 60 thousand fuel filters in a year. We employ a total of 130 people, 103 of which is staffed by Cummins.
What are the advantages of operating in the Aegean Free Zone?
Maturity of the investment and operational environment here is very critical for us. The Aegean Free Zone has the maturity and experience of having served foreign investors for a long time, which adds flexibility and efficiency to investors like us. The tax advantages of free zones speak for itself, however invalidity of exchange deposits requires time to get used to for first time investors in Turkey that are still in the process of getting to know our country.
How do the foreign investors view free zones?
Unfortunately, Izmir is not included in the investment incentive program like our neighbor Manisa is. However, exemptions from VAT, income tax and corporate tax and other advantages make free zones an attractive place for investment. Add to that, the professionalism of the Zone management, its proximity to the airport and the ports as well as the qualified workforce of Izmir make it all the more attractive. A respected old friend once told me, “these foreigners feign reluctant at first, but once they come, they never want to leave.” I completely agree with this, because Izmir, the pearl of the Aegean, is as good as European or North American cities by virtue of its urban life knitted into its rich historical and cultural heritage. In fact, it evolved into a city and an investment environment that foreigners can easily warm up to because of its touristic and liberal nature. I can say with ease that foreigners find more than what they expect to see in Izmir. And the expenses are less compared to Istanbul.
How is your company affected by the recent economic developments that have been unfolding since the beginning of 2014? In what way does this affect the investments?
The developments in Turkey don’t affect us as much since our factory sells to Europe and Africa. However, the fact that Europe has still not yet fully recovered from the economic crisis in 2008 affect our sales, thus procrastinating our investment plans at our factory in Izmir.
Can you give some information about your social responsibility projects?
Social responsibility is one of Cummins’ founding values. Cummins Foundation takes part in social responsibility projects in the countries that we operate in as Cummins Global. CIT encourages labor intensive participation rather than giving donations. The Foundation makes donations to a multitude of projects related to Environment, Education and Social Justice in different countries.
We actively take part in social responsibility projects under two main groups. The first one is that our company encourages its employees to take at least four hours a year for social responsibility projects. We have a work group called CIT in each of our factories and facilities, and these groups identify the social responsibility projects for that year and start to implement those projects together with the rest of the staff. These are generally small scaled projects.
We also have large-scale projects. Cummins has specified six countries, including Turkey, where we carry out projects under the name TEC (Technical Education for Communities). We work with Ege University for our TEC project in Izmir. We initiated Mekatronik College, and worked with prominent companies in Izmir such as Schneider, AKG, Gates, Mahle, Delphi Diesel, Fokker Elmo and CMS to design the school’s curriculum in line with the needs of the industry. Purpose of the program is to train and prepare graduates of 2-year colleges for professional life and to give them the types of education that are in demand by the industrial firms, English being the first and foremost. So, this is a very significant project to close the gap in terms of the number of competent technical staff. Another goal is to increase women’s involvement in business life, because the figures indicate that this number has decreased in the last 20-30 years.
So why Mekatronik? Because it is a profession full of potentials in the future and a good opportunity for women.
As Cummins, we worked with Ege University and received 380 thousand USD from IZKA (Izmir Development Agency). We provide support for establishing laboratories and we used this fund to build the required laboratories. The program aims to train and educate our kids in both school environment and professional life and includes English programs as well as EQ skills that we call soft skills. The students can also get career consultations in addition to their education.
This was the first year of the school and we have a total of 27 students, one of them being a female student. The quota is 30 students. We asked the support of the Ministry of National Education as the number of female students is very few, and the support came with the Ministry’s decision to impose a 50% quota for female attendance. This was a splendid support and development for us and our project. Being able to get this quota is just the beginning. We visit 8th graders and talk about our vision, Mekatronik College, future of the profession and the advantages of the TEC program to help the families and their daughters make the best decision for themselves. We don’t force anyone, we just give information. Everybody can make up their own minds at their own will, but easy access to information is what matters.
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