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Tofas shares tumble in Turkey as new Fiat Doblo to be made in Spain

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By Can Sezer

ISTANBUL (Reuters) -Shares in Turkish automaker Tofas fell sharply on Tuesday after its major shareholder Stellantis said the new Fiat Doblo will be produced in Spain, creating uncertainty about what will be produced in its place in Turkey.

The shares slid 6.1% to 73.95 lira by 1025 GMT, off an early low of 72.85 lira.

Tofas is a joint venture of Turkey's Koc Holding and Stellantis, which was formed in 2021 through the merger of France's PSA and Fiat Chrysler.

Tofas previously said output of the Doblo light commercial vehicle would continue at its factory until end-2022. But it said late on Monday that assessments were continuing on extending the current Doblo version output until end-2023 and on the potential production of new models.

A Stellantis news release on Monday about the new Doblo and E-Doblo vehicles said these would be manufactured in Spain.

Tofas began production of the Doblo, one of the three main vehicles it makes, in the early 2000s and it enabled the company to switch to an export-oriented business model.

While Doblo production by Tofas was originally planned to end at the end of this year, Stellantis has been evaluating for some time whether Tofas would produce the new model.

"We still see a higher probability that there will be new potential projects... However, current news flow does not look very encouraging," said Ata Yatirim deputy general manager Cemal Demirtas.

"Any delay in the announcement of new potential projects... is likely to lead to an overhang in Tofas shares."

Tofas said even if Doblo production in Turkey is extended, European countries will not be among its main export markets, with output focused on the domestic market, the Middle East, Africa and North America markets.

Doblo constituted one third of Tofas' production with 77,520 vehicles as of the end of last year. It also made up 43% of the company's exports with 48,761 units.

Aside from the Doblo, Tofas produces the passenger model Egea and another light commercial vehicle platform, the MCV, in smaller volumes.

Tofas has a production capacity of 450,000 a year, but output decreased after the coronavirus epidemic. It produced about 229,000 vehicles last year.

(Reporting by Can SezerWriting by Daren ButlerEditing by Jonathan Spicer and Jane Merriman)

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