Date: 25.08.2019

Chairman of Board of Directors of Untes, Mr. Mehmet Sanal: “Untes will grow further in international sales”

01.02.2019
Chairman of Board of Directors of Untes, Mr. Mehmet Sanal: “Untes will grow further in international sales”

Untes, providing innovative and integrated air conditioning solutions and targeting sustainable comfort and efficiency to the HVAC sector since 1968, is celebrating its 50th year. Mr. Sanal says “We have an industry culture coming from the long past” and indicates that they will increase the share of exporting in the total turnover of their company up to 45 percent in 2020.

Would you please explain Untes’s travel from the past until today?
Untes was established in 1968 in Ankara in a small industrial zone, thereafter, we started our activities in another zone in 1970s. At the time of our first establishment, we were producing limited ranges of unit heaters and small sized industrial fans. In 70s, we started to produce cooling tower and air handling units. During those years, industrial ventilator production also increased. In 1970, we started the construction of our new production plan that still in the same place now. In 1980s, we decided to expand our factory again. At the time of establishment, we were a collective company having 5 partners. We converted our company into an incorporated company in 1988. In 1993, the second generation took over management. We opened our domestic sales offices in Istanbul in 2001, in Adana in 2003 and in Izmir in 2004. We entered into a representation agreement with Rhoss-Italy in 2000. Entering into an agreement with Rhoss in 2006, we carried all of their fancoil production line to Turkey and started fancoil production. At the end of the representation agreement that lasted for 12 years with Rhoss, we decided to perform production together. We started the production of water chillers in 2012.
In 2016, we started the production of heat pump cooling group.  We entered into an agreement with Hisense in 2016 and started the sales of VRF systems. We will start the production of chillers with inverters at the beginning of this year.
We had a deficit of VRF in terms of imported products. We established Untes VRF company to reach our targets in the future periods. We prepared a long – period prospective road map with Hisense and started the sales of VRF air conditioning systems. Everything goes well here. We created a service network covering entire Turkey and currently we have more than 100 services. We are progressing everyday at the sales points.
What does the name Untes stand for? You are celebrating your 50th year, what would you like to say about it?
The name Untes consists of abbreviations of the words “Unlu” (Famous) and “Tesisat” (HVAC) and means “Famous HVAC”. This year, we are celebrating our 50th year. We have an industrial culture coming from our past. When considered in terms of production facilities, we have the greatest facility in terms of types and capacities of central air conditioning systems in Turkey. The products that we produce on Untes side are being produced in 3 main buildings here. We are producing the air conditioning plants in the 1st building and the rooftop and package air conditioners in the 2nd building. We are producing fancoil units in our other factory. We are exporting 30% of the products that we are producing for now.

Can you give some information on your production facilities and laboratories?
In 2017 Untes became an R&D center of HVAC Industry in Turkey. We made a serious testing laboratory investment for package air conditioners. We commissioned this laboratory in 2015. We established a fancoil test laboratory in 2012. Our fancoil test laboratory is currently unique in Turkey.
We have a facility producing chillers in the most professional sense. We are producing water chillers up to 1750 kW in our facility. Untes-Rhoss is a company that is owned 50/50 percent by Untes and Italian Rhoss company. We performed the technological transfers of all products produced in Italy and made the products, which we imported, national. We can perform the test of products up to 1750 kW with our test stand in our facility. With another test stand, we can perform the tests of heat pump water chillers.
Briefly, we can offer the performance verifications of all units that we produce here to our customers thanks to our test stands. We have more than 300 employees on Untes side and 40 employees on Rhoss side.
Currently, we have capacity for producing 1200 chillers during a single shift. As of the end of the year, we will start the production of cooling groups with screws in Turkey. We will bring various products to Turkey in the new period and we will try to increase our volume here.

Will you please provide information on your export? The importance of export has increased in recent times due to the problems that occurred. Can we hear your opinions on this matter?
We are targeting to increase the share of our export in total turnover to 45 percent within 2-3 years. There will be some regression in the private investments due to the economic problems in the construction sector and in our country. Therefore, all sector firms have to develop themselves in export area.
We have offices in Dubai, Kazakhstan and Turkmenistan abroad. The products that we produce are being exported to approximately 45 countries in the world. Currently, the products of Untes are reaching a wide geography from Australia to Chile. Mainly our export is to Turkic Republics and Europe.  We started creating serious locations also in the South African market.
We are a firm with 100 percent domestic capital. We have to continuously contribute to the industry and development of the country. For example, we started fancoil production in 2006; however, at that time the Chinese started to enter in the country. Many producer firms came to the point of stopping production. At those times, we struggled and managed to ensure the imposition of anti-damping tax against China. Acting as a leader about that, we prevented import, even if partially. By this way, 7-8 firms in Turkey started fancoil production. Therefore, we assume such policies as missions and we are trying to open the path for the sector.

Can we hear your economic assessments related with the sector?
In fact, the sector gained a good acceleration this year. When we look at the first half of the year, the sector developments were pretty good. However, in the second half, sector is subject to a let-up in the domestic market. However, foreign capital firms made serious investments in our country. This direction started to be effective in the air conditioning sector, however, we have a long way to go. Maybe it’s difficult for the next year, but I think important investments will come from other countries to the sector in 2-3 years. Examining the growth trend, the sector lost some blood in the second half of this year, however it will close the year in positive direction. But regardless of what we produce from now on, we have to not develop a strategy for the domestic market. When we look through Untes’s window, we are performing R&D and marketing studies to find an answer to the question “Where can we sell the products that we produce in world standards?” Because, it does not make sense to grow much in the domestic market.

What are the latest trends in the products?
In the air –conditioning sector, the trends are towards energy efficiency and environment-friendly products. Currently, the development trend of the products is progressing on software and electronic accessories. There is no change in the main functions of the devices; developments are occurring in their energy efficiencies, and consequently, in the automation of devices.

What will be your targets from now on, can you summarize?
In the future periods, our investments will continue in line with the needs of the sector. We had a serious development in the past 10 years. We have a few projects that we plan for the following period, but we will make Untes a global trademark increasing export more in the following 10-year period.

What should be done to develop industry and what contribution can the state make for this purpose?
Production must be increased to develop industry. At this point, production subventions are not a must for production. The state has to encourage the producer by using domestic products in its own investments. Precautions have been put in force for this purpose, but there are deficiencies in their application. I can not think of a better subvention than the state’s using domestic products in its own investments. The stronger the domestic investor is, the stronger it will become abroad. The second problem is the serious increase in financing costs. Attractive loan offers must be provided for the industrialists under these conditions. Furthermore, in terms of the air conditioning sector, there are problems especially in relation with receivables from public works, firms are announcing pre-arranged bankruptcy and the sub-contractor or supplier firms are being affected depending on the construction sector.