ISTANBUL (Reuters) -- Carmaker Tofas, a joint venture of Turkey's Koc Holding and Fiat, posted a net profit of 32.86 million lira ($20.66 million) in the first quarter, down 60 percent from a year earlier.
The company said sales in the first quarter fell 33 percent year-on-year to 872.46 million lira.
The company's results were expected to be affected by a sharp contraction in both domestic and export demand as the global economic crisis bites.
In a filing posted on the Istanbul Stock Exchange website Tofas said its exports fell 50 percent in the first quarter to 32,678 vehicles. Car exports fell 59 percent in the same period.
The number of vehicles manufactured by Tofas fell to 42,200 in the first quarter from 80,507 last year.
The company said it had invested 49.88 million euros in the first quarter despite serious loss of orders due to the global crisis.
"Despite all these negative factors, our company's domestic turnover jumped 64 percent compared to the previous year. The basic reason for the rise is the special consumption tax cut," the company said.
Tofas posted a net profit of 175.75 million lira last year, little changed from a year earlier.
Chief Executive Ali Pandir has told Reuters 2009 sales were seen falling below 2008's 4.8 billion lira but that Tofas hoped to maintain the same profit level.
Collapsing demand forced Tofas, along with other manufacturers, to temporarily suspend production at the end of last year and the start of 2009, prompting Turkey's government to slash sales tax on cars to 18 percent from 37 percent in a bid to revive consumption.
However, the scheduled end of that incentive in mid-June is expected to trigger a fresh contraction in the market in the remainder of the year.