“Having set out to play a part in shaping the future of Turkey, we will take the ALTAY tank into the future with state-of-the-art technologies.”
The ALTAY Tank Serial Production Project, one of the most prominent programmes on Turkey’s agenda, has crossed yet another important threshold with the signing on November 9 of the project contract between BMC and the Presidency of Defence Industries (SSB). Meanwhile BMC POWER – a BMC subsidiary – is rolling up its sleeves to address the issue of power pack development, which has become a thorn in Turkey’s side. We had the opportunity to discuss with T. Yasin Öztürk, Member of the Board at BMC, not only the novelties that BMC envisages to add to the ALTAY tank during serial production, but also the company’s other vehicle projects and the engines under development by BMC Power.
MSI TDR: BMC has been the force behind many important developments in recent times, each of which we will discuss separately, but we would first like to start with the ALTAY tank. What are your thoughts about the serial production contract you signed with the SSB on November 9? By assuming ALTAY’s serial production, how has BMC repositioned itself within the Turkish defence and aerospace sector?
Yasin ÖZTÜRK: BMC is a company that has already proven itself with military wheeled vehicles; but aside from this, it has also recently undertaken the responsibility of the modernisation of the Leopard 2 tanks in the Land Forces Command’s inventory. With the serial production of ALTAY, we will be increasing our presence notably on the tracked vehicles. It should be noted, however, that our works in this area will not be limited to the serial production of ALTAY and the Leopard 2 modernisation. There is a point that we often reiterate: Whatever Turkey needs, and in whichever area it has a shortcoming, we are ready to step in. We will do our best to come up with whatever the country is lacking. With this in mind, we shall be focusing our efforts on Turkey’s other needs in the field of tracked vehicles, designing new vehicles to this end.
A Day to Remember at Karasu!
MSI TDR: At what stage is the project currently? And more importantly, what will be BMC’s next step?
Yasin ÖZTÜRK: We have received the first prototypes of the tank from the state; right now, they are at the 1st Main Maintenance Factory in Arifiye, which is affiliated with the Ministry of National Defence, where we have been allocated a 5,000-square metre area. It is here that the maintenance of the prototypes is currently being carried out. Once we have completed our investments in Karasu, we will be taking the prototypes to our own facilities. So, what we have right now is just a temporary solution. As it stands, both the prototypes and facilities belong to the state, while we are just the contractor.
As part of the investments I have mentioned, we held a groundbreaking ceremony for the BMC Technology and Production Base at Karasu on January 13, where President Erdoğan honoured us with his presence. On the same day, we hosted the “Next 50 Years with BMC” meet-up and held also the official inauguration, with live broadcasts and all, of the modernisation investments made at our Pınarbaşı Izmir facilities that have been equipped with state-of-the-art technologies.
The meeting also witnessed the starting of the first indigenous and national engine, developed by BMC POWER, and the official launch in our country of our brand’s latest legend, BMC TUĞRA Truck Family, which took the stage in all its glory. In brief, the meeting shared with our country and the rest of the world “BMC’s vision for the following 50 years”. January 13, 2019, is thus a day to remember both for our sector and our collective memory.
Under the auspices of the President, and guided by his great vision, we have taken one of the most important steps in our journey towards the creation of a national and indigenous [defence] sector in our country, a journey that has been ongoing for 17 years with great success. Once our technology and production base is fully established by 2023, the company’s entire range of activities will create employment for 10,000 people, and contribute $5 billion in added value to the national economy every year. Our export target, meanwhile, will be about $1 billion. The first phase of our facilities, the foundations of which were laid on January 13, will cover approximately 100,000 square metres, with construction scheduled for completion by the end of 2019 following highly intense works, and the facility will become operational in 2020.
Greater Indigenousness and Lower Weight for ALTAY
MSI TDR: What contributions will BMC make to the project during its serial production phase?
Yasin ÖZTÜRK: We will manufacture 40 in total of the T1 version of ALTAY, after which we will move on to the production of 210 of the T2 version. At this particular stage that BMC’s contributions to the project will become apparent. The first of these contributions relates to the vehicle’s power pack. Our subsidiary, BMC POWER, is already engaged in the ALTAY Tank Power Pack Development Project, working on the development of both the engine and transmission of the tank. But in addition to the engine, there are other systems that we are planning to integrate into the tank. We shall also provide the tank’s gun with the ability to fire laser-guided munitions, thereby increasing its accuracy against targets at long range. We shall also isolate the ammunition within the tank from the rest of its hull, such that even if the ammunition explodes because of a damage sustained by the tank, the energy of the explosion will be directed outwards, thus protecting the rest of the tank. Another one of our contributions will be the granting of remote-control capabilities to the tank. For this version, named T3, we are considering first developing a tank with an unmanned turret. As you may appreciate, once the turret has been rendered unmanned, doing the same to the tank’s hull to develop a wholly unmanned tank is fairly easy, and we have already had success in this field with the AMAZON vehicle. We shall be working in very close contact with the Turkish Armed Forces (TSK) throughout all of these processes. We shall also be transferring to the project the experiences acquired by TSK in recent times, especially the Olive Branch Operation, and shall be keeping an eye on global developments in the field of tanks. In summary, we shall be rolling out an entirely new ALTAY – one that is lighter, that boasts enhanced armoured protection and firepower, and that offers even greater comfort to the crew inside. Having set out to play a part in shaping the future of Turkey, we will take the ALTAY tank into the future with state-of-the-art technologies.
Tank’s Weight to Drop Below 60 Tons
MSI TDR: At this point, can you further elaborate on your plans for indigenisation?
Yasin ÖZTÜRK: We shall first focus on the areas that fall within our responsibility, which, as you know, include production of the hull, power pack, track and suspension equipment, along with various subsystems. Aside from the indigenisation of the power pack, another one of our most important contributions in this regard will be the armour. Presently, there is no company in Turkey capable of producing armour-grade steel, which is why we are spending many hours working with the Ereğli Iron and Steel Factory (Erdemir), discussing the indigenisation of armour-grade steel. We are even mulling over the possibility of utilising boron ore. We must find a way to lighten the tank, since the tank’s hull, in other words its armour, accounts for a significant proportion of its weight. The prototypes weigh around 70 tons, but we are aiming to pull the weight down to below 60 tons, without concessions to the tank’s protection level. So, this will be another area in which we shall be making an important contribution. We are similarly working on the indigenisation of the tracks and suspension system, since the current suspension system has been sourced from the Republic of Korea. Concerning the production of the track shoes, we are in talks with the 1st Main Maintenance Factory in Arifiye. With regards to the subsystems falling under our responsibility, we will make extensive use of the experience and knowledge we gained through KİRPİ programme. Some of the subsystems we will use on ALTAY will be the same as, or scaled versions, of the ones we have already integrated into KİRPİ and KİRPi II.
Industrialisation Plan was the Most Crucial Step
MSI TDR: With regards to industrialisation, what is BMC’s game plan for the project?
Yasin ÖZTÜRK: Industrialisation is perhaps the most critical aspect of this project, and is actually one of the reasons why the contract negotiations lasted so long. While we are indeed the prime contractor in this project, we shall be doing the brunt of the work together with our subcontractors. BMC’s share of work within the total, even when you include the power pack under BMC POWER’s responsibility, does not exceed 20 percent. And when you remove the power pack, this share drops to less than 10 percent, which shows that our subcontractors have important tasks to fulfil. Our subcontractors include such leading companies as ASELSAN, HAVELSAN, Mechanical and Chemical Industry Company (MKEK) and ROKETSAN. All responsibilities have already been clearly defined, and even when we were submitting our proposal for the project, we discussed everything with our subcontractors down to the finest details, delineating the tasks of each part with bold demarcations. The entire process took considerable time, but looking at the quality of the final product, I would say it was worth it. Since the platform we call a tank is a combination of armour protection, firepower and mobility, you need to optimise all of these features in the best possible way. The final product we deliver to the end user must be flawless, because in the end, ALTAY belongs neither to BMC nor any other institution, but is a property of the Turkish nation, to be used by Turkish soldiers. For this reason, we make no concessions whatsoever in any of the tank’s requirements. We always stand by our word, and we are ready to commit ourselves in every way to live up to our promises, just as we have done until now.
MSI TDR: Prof. Dr. İsmail Demir, President of Defence Industries, said back in August that ALTAY had attracted considerable attention overseas. What is your vision for the export of this platform?
Yasin ÖZTÜRK: ALTAY has a tremendous export potential, and is drawing significant attention from various countries. Among them, Qatar and Tunisia in particular have expressed great interest, and we are in constant talks with them. In fact, ALTAY will soon go to Qatar for testing, and should the tests be concluded favourably, there is the possibility that we will receive an order for nearly 100 tanks from Qatar. Once the tests are completed, rather than bringing the tank back to Turkey, we plan to take it to other countries in the region, to introduce it to potential users in the Middle Eastern market. We shall then be taking it to the Turkic Republics, the Balkans and Africa.
ALTAY Tank Draws People to Itself
MSI TDR: How has BMC prepared for the ALTAY Project in terms of human resources?
Yasin ÖZTÜRK: We have bolstered our team with experienced people, and have had many new colleagues joined us, many of whom have worked on ALTAY while in other companies. This should not be perceived, however, as a transfer of personnel from one company to another, since they have come here not for BMC, but for the ALTAY. The same people who devised the tank also wanted to partake in its serial production. ALTAY is today seen as a national asset and a source of pride for our country, and these people were motivated to join our efforts based on this same sentiment. Our role here is basically to serve as intermediary in all of this.
MSI TDR: Could you share with us details of the current situation in the modernisation of the Leopard 2 tanks in the inventory of Turkish Land Forces Command?
Yasin ÖZTÜRK: When the project first started, the modernisation of a total of 84 tanks under different categories was envisaged. But in line with user requirements, the project has now evolved into a wholly different point. This evolution occurred because TSK felt that its recently gained operational experience needed to be reflected onto the project’s requirements, and so we have been in close contact with the user, and have listened carefully to their feedback. Right now, our work on the first tank is drawing to an end. In a few months’ time, we will complete the first tank and launch serial production for the others. Contractors are generally averse to constantly changing requirements in the middle of a project, since these types of projects and requirements tend to come with many uncertainties that engender additional financial burdens. However, these tanks are likely to be used in similar operations perhaps in the near future, meaning that our soldiers will be entrusting their lives to them. Under such circumstances, we cannot act with only financial concerns in mind, and it is for this reason that we have maintained an understanding disposition, and a keenness to modernise the tanks in the best way we can.
Rheinmetall to Provide Consultancy Services
MSI TDR: During the signing ceremony held at the SSB for serial production of ALTAY, Ethem Sancak, Chairman of the Board of BMC, said that the partnership with Rheinmetall had been terminated, and the German company would be providing only consultancy during the project. So what exactly will be Rheinmetall’s role in this project?
Yasin ÖZTÜRK: Although the details have yet to be fleshed out, we will receive consultancy services from Rheinmetall, just like Mr. Sancak said. There are four important points that we need to address on ALTAY before moving ahead with serial production, all of which are under the responsibility of our subcontractors. We believe that waiting for an improvement in Turkey’s means and capabilities in these areas will result in a substantial loss of time for the project. Rheinmetall is one of the leading companies in the world in this field, with many years of experience, and ALTAY is a long-term project that will have an impact on Turkey’s future in many ways. For this reason, we decided that the consultancy alternative would be the best solution with respect to delivering the best tank possible to our nation and state. As I have said earlier, Rheinmetall’s consultancy will focus on various points being handled by our subcontractors, and which constitute the industrialisation aspect of the project.
MSI TDR: What did you achieve during your partnership with Rheinmetall?
Yasin ÖZTÜRK: Although this partnership has now effectively ended, we had an extensive exchange of information in the time we spent together. First of all, we were able to identify some of the shortcomings in the design of ALTAY, and, by extension, what needed to be included in the contract for the serial production phase. Rheinmetall’s support in this regard was tremendous. Had our partnership continued, they would have also supported us in the training of our personnel.
Raising the Bar Further as Targets are Approached
MSI TDR: In our previous interview, you said that BMC’s objectives for the end of 2018 were 2,900 personnel employed and a turnover of $1.2 billion. To what extent have you attained these targets?
Yasin ÖZTÜRK: In terms of personnel numbers, we have reached and even surpassed this number. As for our turnover, we had set a target of ₺4.4 million at the time, which we have also attained.
MSI TDR: What are your targets for the upcoming period? For example, what kind of a BMC can we expect to see in 2023?
Yasin ÖZTÜRK: First of all, for 2019, our target is to reach 3,500 employees and a turnover of ₺6 billion. In the defence sector, domestic business activities will represent 60 percent of our turnover, while exports will make up the remaining 40 percent. As for bus sales, we will focus exclusively on overseas markets. These numbers, of course, do not include BMC’s subsidiaries. Our targets for 2023 are already known: To become a company of 10,000 employees with a turnover of $5 billion, and we also want to make it onto the list of the top 100 companies in the defence and aerospace sector in the world. And our ultimate goal in this area is to eventually climb into the top 10, and we are consistently moving forward with this target in mind. Consistency has, in fact, become a guiding principle for us, as we have met all of our targets for the past five years. It can even be described as the most important article in BMC’s “constitution”. We have managed to sustain this consistency by maintaining a balance between the defence and commercial vehicle sides of our business.
Investments Continue Unabated
MSI TDR: Aside from your investments for the serial production of ALTAY, can you give us an update about your current investments in other areas?
Yasin ÖZTÜRK: We are making a range of different investments, all of which are moving forward in parallel with one another. First of all, we are making $80 million of investments for BMC POWER at Karasu, and we have set aside another $100 million for investments in 2020 for rail systems also at Karasu. Furthermore, the construction of our R&D Center in Ankara is continuing. As I had said in our previous interview, including our investments for ALTAY, the total sum of all our investments will exceed $685 million.
Growth to Continue with New Companies
MSI TDR: Could you give us a summary of which companies currently make up the BMC family?
Yasin ÖZTÜRK: Several names I can give are BMC POWER, which works on power packs; BMC Rail Systems, which works on rail systems; and BMC Tank and Tracked Systems, which, as its name implies, focuses of the production of military tracked vehicles. But these are just the tip of the iceberg. Aside from these, we are also supporting many other companies that work in critical areas where Turkey has specific needs, but whose names we cannot divulge at this stage, and we are direct partners of some of these companies.
Shaping the Future of Turkey
MSI TDR: Speaking of BMC POWER, could you tell us about the company’s vision?
Yasin ÖZTÜRK: We established BMC POWER with a view to having it develop engines for our own vehicles. The power pack is one of the areas in which Turkey faces the most difficulties, and which contains the largest obstacles to its export efforts. It is in this field that we want to do our part and clear a path for Turkey. That is why we are willing to meet all of Turkey’s power pack needs, including the needs of other domestic armoured vehicle manufacturers, with the power packs we will produce. This is a must for commercial sustainability. At this time when where we are taking steps to shape the future of Turkey, neglecting sustainability will halt our efforts dead in their tracks. Our calculations indicate that producing our own power pack will bring a cost saving of $10,000 per vehicle when compared to a foreign-sourced power pack, and that is why our target is to produce 80,000 engines per year. Once we will be producing in such quantities, we believe that we will be meeting a large proportion of Turkey’s needs. However, this is no easy task. As you know, our rivals abroad started this marathon nearly 100 years ahead us, and while the gap [between us and them] is not too large, they are still in front of us. Accordingly, we must work 24/7, not just for BMC, but also for Turkey’s future. We certainly don’t have the luxury of any rest.
MSI TDR: What can you tell us about the engines that BMC POWER is currently developing?
Yasin ÖZTÜRK: At BMC POWER, we are developing power packs of many different horse powers through different projects that are running in parallel with one another, although there are three of these that have particularly attracted public attention. We have already spoken about the ALTAY power pack, but aside from this, we are also shouldering responsibility for the National Power Pack Development Project for the New Generation Light Armoured Vehicles. Then there is the AZRA engine, which BMC POWER started to develop with its own resources. Within these three projects, we are developing 1,500, 1,000 and 600 hp engines, and for the first two of these, we are already working on the transmission. When we launched the AZRA project, our goal was to produce a 380 horse power engine that could be used in tactical wheeled armoured vehicles such as KİRPİ and VURAN. However, driven by the vision I mentioned earlier, we decided from the outset of the project to raise this output to 600 horse power. The first official ignition of the AZRA was made on January 13, and tests are still continuing. Of course, in line with our other needs, we have started to work on another 380 horse power engine.
BMC POWER’s Targets include Naval Platforms
MSI TDR: After land and air vehicles, will BMC POWER launch works aimed at naval platform power packs?
Yasin ÖZTÜRK: As I mentioned earlier, commercial sustainability requires that we produce at least 80,000 engines a year, and to achieve this, we must expand beyond the land vehicles market, taking the needs of other sectors into account. This 80,000 figure includes everything from generator engines to naval platform engines. That is why our company envisions the development of engines ranging from 110 to 6,000 horse power.
Autonomous Systems and Advanced Technology
MSI TDR: You also mentioned that during the serial production project for the ALTAY tank, you will be developing a tank with an unmanned turret, having already developed a version with remote control system of AMAZON. Can we say that BMC’s is priming itself to be a greater presence in the field of unmanned vehicles?
Yasin ÖZTÜRK: We realise that we won’t get anywhere by imitating what others are already doing around the world, as this would benefit neither BMC nor our country. We have set out on our path with a determination to illuminate Turkey’s future, and we are ready to do whatever it takes to achieve this. It is for this reason that we are increasing our presence not only in the field of unmanned vehicles, but across a broader spectrum. We are in the process of establishing a new department that will be engaged in R&D projects involving advanced technologies. This department will work in a wide range of areas, from autonomous systems to automotive systems, and from the defence sector to smart cities. It will even lend support to the ongoing works aimed at an indigenous automobile, and there are already some defence sector projects in which they have started work. We have already allocated a $20 million budget to this department for 2019, which will employ around 70 personnel, most of whom will be experts with previous experience in innovative technologies.
MSI TDR: We have already spoken about the ALTAY tank, but does BMC have any other export projects for its other vehicles?
Yasin ÖZTÜRK: It always had, and always will. The level of interest our vehicles is witnessing is increasing rapidly. Accordingly, we are establishing a foreign business development department aimed specifically at the defence sector, and we shall quickly expand our team there. I personally keep track of foreign business development. With the defence sector and commercial vehicles on one side, and special vehicles and spare parts on the other, we are seeing a rapid expansion of our product portfolio, and the export potential of our products is increasing in tandem with this. It is these two basic reasons that have led us to adopt a new organisational approach. On the export side, I should also highlight the support being provided by the state to all companies in the sector, us included.
New Vehicles on the Way
MSI TDR: Could you elaborate on the other projects and vehicles on BMC’s agenda? Can we expect to see any new vehicle projects in the near future?
Yasin ÖZTÜRK: You can indeed. On one hand, we are continuing to build on our existing vehicles. First of all, there are two versions of our latest tactical armoured vehicle that we are working on: One will be equipped with CİRİT missiles, and the other with a multiple rocket launcher (MRL) system. We are also devising a new version of our AMAZON vehicle. On the other hand, we are also designing vehicles that are completely new. For example, we have a project underway for an 8×8 tactical wheeled armoured vehicle with offensive capabilities. In addition, we are also designing a light armoured pickup truck of the type often required by the General Command of Gendarmerie and the Turkish National Police in areas of close conflict. The vehicles will leave the production line with their armour already fitted, which will make them more effective than solutions with armour added as an afterthought. On the logistic vehicles front, we will soon be introducing our 8×8 tactical wheeled vehicle, while at the same time producing 4×4 VIP vehicles that can be used by governorships.
MSI TDR: Could you give us an update of the current situation with BMC’s ongoing projects.
Yasin ÖZTÜRK: In the Tactical Wheeled Vehicles-2 project, we are continuing to deliver the KİRPİ II, and in 2018 we delivered the first KİRPİ II AMBULANCE configuration to security forces. As for the Battlefield Fuel Tank (AKTAN) Project, we have completed deliveries. During DIMDEX 2018, we signed a new contract with the Qatar Armed Forces foreseeing the supply of 50 KİRPİ II and 35 AMAZON vehicles. We have already shipped the AMAZON vehicles, and we expect to complete deliveries of the KİRPİ II in early 2019.
MSI TDR: Speaking of Qatar, there were plans to establish a facility in that country. Has there been any progress in this regard?
Yasin ÖZTÜRK: Both we as BMC and the State of Qatar are willing to have this idea move forward; however, the Qatar State is still in the process of deciding on the location. Once this process is concluded, we will kick-start construction of the facility, where we plan to manufacture vehicles intended for both military and civilian use. Due to its geographic conditions, Qatar’s preferences are leaning more towards light-class vehicles, since these exhibit better performance under desert conditions than heavier ones. For this reason, our activities in these facilities will focus mainly on rolling out these types of vehicles. On the civilian side, we are planning to manufacture a variety of buses, which will be used during the 2020 World Cup in Qatar.
MSI TDR: One aspect that really sets BMC apart from the numerous other players in the defence and aerospace sector is its presence also in the commercial vehicles sector. Can you share your thoughts on this subject? How have you maintained a balance between these two different sectors so far?
Yasin ÖZTÜRK: As I said earlier, we are a company that is working to illuminate Turkey’s future, for which we must first ensure our own commercial sustainability. By its very nature, the defence sector is not a market that can guarantee this on its own. Projects can become highly intense from time to time, and then come to a complete standstill. That is why we consider it essential to keep a foothold in the civilian vehicle market, which was historically the starting point for BMC as a company. At times when the pace of defence projects slows, commercial vehicles will become our driving force. That is why we will continue to make our own trucks and busses. The civilian side is not an area that we would ever relinquish. On the contrary, we will continue to be as bold and daring in this area as we have been in the defence sector, constantly guiding the market with innovative products. This has led us also to venture into the field of passenger cars, and we will have our own part to play in Turkey’s National Car Project. We shall also be entering the field of rail systems, and will take part in high-speed train projects. Today, the balance between our military and civilian business is 70 to 30 percent, respectively. Our goal, however, is to further strengthen our civilian side to create a 50-50 balance.
MSI TDR: Is there anything else you would like to add?
Yasin ÖZTÜRK: From time to time, issues and discussions are raised in the public about BMC, and there is one thing I would like to highlight in response to them. At the time that we acquired BMC, it was already a 50-year-old company, and our goal was to add another 50 years on top of this, and to hand BMC over eventually to the following generations. In the end, BMC is neither a company of the Öztürk family, nor of the Sancak family, nor of the Qatar Armed Forces. BMC is a national asset for Turkey. It is a company with many groundbreaking achievements in its history, such as the production of Turkey’s first diesel fuel truck; Turkey’s first 100 percent indigenous truck, whose intellectual property and industrial rights belong exclusively to our country; and Turkey’s first light commercial vehicle. We were passed this torch by previous generations, and we shall do just the same, for the generations that will follow.
There is one other point I wish to add: We did not purchase this company with commercial expectations in mind; it was clear that we did not have such a commercial need. As patriots who love their nation, our primary motivation is doing something for our country, and that is why we will continue pursuing our works, project and investments, relentlessly and without pause.
On behalf of our readers, we would like to thank T. Yasin Öztürk, Member of the Board at BMC, for taking the time to answer our questions and for providing us with such valuable information.