Order intake in the construction equipment industry allows manufacturers with production sites in Germany to look forward to 2022 with confidence. When companies will be able to realize their revenue, on the other hand, is an open question, as materials continue to be scarce and supply chain problems delay the production of construction equipment. Statistics clearly show a gap between incoming orders and turnover.
In 2021, the construction machinery and building materials plant sector achieved a 22% increase in turnover of 16.7 billion euros compared to the same period of the previous year. The construction equipment sector achieved a nominal increase of 18% to 12.4 billion euros. Incoming orders increased by 53%. The export turnover was 8.1 billion euros and the domestic turnover was 4.3 billion euros. Encouragingly, building construction, earthmoving and road construction machinery is evenly distributed. Road construction machinery achieved the highest increase in turnover with 22%. This development propels the industry to the all-time high of 2018/19. Nevertheless, sales forecasts are cautious this year. The biggest risk, in the experience of many manufacturers, is continued supply disruptions. “We are pushing ahead of us a wave of orders that we will probably have to carry until 2023 if the situation persists”, fears Joachim Strobel, president of the construction equipment division of the VDMA. “Despite well-filled order books, the industry can only expect a maximum revenue increase of 7% for the current year. Profit will also be below our expectations because we have to do in the face of extremely high costs.”
Economic stimulus programs boost the United States and Europe
The United States, Europe and China remain the largest market regions and together account for 75% of the global market. Sales of construction equipment in 2021 increased by 30% in the United States and by 28% in Europe compared to the same period last year. China weakened with a decline of 7%. Overall, sales increased by 18% in total, 32% excluding China. Nevertheless, the country remains the largest single market. The American market is promising for the next few years. With massive economic stimulus programs, a golden age could dawn for the construction industry in the United States. In Europe too, the economic recovery programs launched during the pandemic will have a supporting effect in the next 2 to 3 years. In China, development is uncertain, the risk of a real estate crisis is still present there.
In Germany, sales of construction equipment increased by nearly 10% last year and demand from customer industries remains high this year. This boom may even challenge the shortage of skilled workers and material bottlenecks.
Back to personal meetings at trade fairs
At the top of the priorities of construction equipment manufacturers are the tasks of reducing CO2 emissions and advancing digitalization. They are also key topics at major trade shows for the construction equipment industry and building material factories this year. ceramitec in June, glasstec in September and bauma in October will present avant-garde developments. “We are all looking forward to our presence at trade fairs. Finally, we can once again demonstrate on a large scale the technical progress that we have already made to achieve the goals of climate policy”, emphasizes Franz-Josef Paus, President of the construction VDMA.
Read the article online at: https://www.worldcement.com/europe-cis/21022022/vdma-discusses-the-state-of-the-german-construction-equipment-industry/