‘No worries’ for Germany

A gradual improvement in Germany’s construction market means that the industry there should not have to worry, with the Bauma show helping to lift the mood.

The VDMA, Germany’s specialist association for construction equipment and building material machinery, said that its forecast of a weak start to the year followed by a gradual improvement throughout the following months seemed to be more true than ever now.

It added, though, that there were differences when looking at the individual divisions within the industry.

At its summer meeting, held in Hameln, Northern Germany, the association’s board said that the Bauma show in April had helped to change the industry’s mood significantly.

It said that the show had directly or indirectly led to a great number of new orders, but that in the meantime, a downturn had become visible again. The VDMA added that with the restrained industry forecast, this year’s scenario could probably best be interpreted to be a sideways movement.

The common view of the association’s board, however, in light of the industry’s high overall current level, was that there was no reason for any worries.

Construction equipment is currently the only division within German building construction that is growing, though. The VDMA said that in recent weeks, an increase in demand had been visible in all areas.

It added, however, that it had to be feared that the negative figures during the weak first quarter for earth moving and road construction machinery would probably have been too great to lead to turnover of close to zero for the entire year.

The demand for building material machinery was higher in the first quarter of this year, compared to the same period last year, thanks to the effects of special projects. Even if these should wear off slightly in the next couple of months, growth for the entire year 2013 was still very realistic, it said

The VDMA said that the Middle East – especially Saudi Arabia – Russia, although with a slightly decreasing dynamic, the central Asian states and, with some cut-backs, North America and Brazil, were among the markets that currently looked positive. Germany, France and Scandinavia remained rather stable, it said. At the negative end of the scale are, as before, the Southern European countries.

It added that China and India were also disappointing – after a weak 2012, there has currently not been a real upturn yet.

The German construction equipment and building material machinery industry made €12.5 billion in turnover in 2012, said the VDMA. Of this, €7.9 billion was on construction equipment and €4.6 billion on building material, glass and ceramics machinery.