Data confirm the crisis in the sector, although there are timid signs of a recovery. China continues to explode China while North America and Europe are losing ground. Production and investments in the building industry halved in Italy.
Barcelona last 22 October during the annual convention organised by CECE (Committee for European Construction Equipment, the Authority grouping European Associations of construction machinery producers) saw the presentation of data detailing the general trend for the building market in Europe. The convention was also attended by delegations representing trade associations in the United States (AEM – Association of Equipment Manufacturers), Brazil (Sobratema – Associação Brasileira de Tecnologia para Equipamentos e Manutenção) and Japan (CEMA – Japan Construction Equipment Manufacturers Association).
Data published by CECE suggest that the international situation will remain fluid in the short-term because recoveries after financial crises are always slow but that indicators should point on steady growth. Governments will have to define exit strategies to facilitate the recovery, not the least because otherwise financial markets will impose them. In a panorama in which salaries and inflation will remain unchanged, Asia will move into the overtaking lane, North America the central lane and Europe the slow lane.
As regards Europe, experts agree that recovery from the damage caused by the crisis will be highly irregular and characterised by the fact that while economic recovery and the weak euro will drive growth in exports, increased taxation, unemployment and the credit squeeze will tend to hamper them, while the cost of work will have a negative impact and create a gap between the north and south of the continent.
Forecasts for the next two years still see Germany in the driving position, although Great Britain should overtake it in 2012, contrasting performances for France with 2011 down compared to 2010 but up again in 2012, and Spain, that after being the only western country in 2010 to post a drop in GDP will resume growth in 2011/12.
The situation is more complex for countries in Eastern Europe, where there is evident need for government intervention with fiscal reforms to block the crisis, although it is unlikely that the growth rates achieved in the period 2002/07 will be resumed. Among emerging countries in Europe, the best performance was posted by Poland, that boasts a strong domestic market and low levels of international indebtedness. In fact, Poland – the only Eastern European country achieving growth even in a terrible year such as 2009 – will continue to grow in 2011 and 2012, while the same period will see Turkey post the most significant increases.
In this context, Italy is a half-way house. After posting – admittedly by a small margin – the worst loss in terms of GDP in 2009 among the 5 industrialised countries of Western Europe and having reacted positively in 2010, Italian GDP while still growing will post 2010 indicators below those for 2009. Forecasts for 2012 finally suggest a recovery, albeit less than in other countries. (Source: IHS Global Insight)
World machinery scenario
As indicated in the Off-Highway Research essentially dedicated to production of machines and vehicles for earth moving, after the explosion in the three-year period 2005/07 in the wake of easy access to credit and growth of Chinese demand (1,000,000 units sold for 99 billion dollars in 2007) the market saw a drastic down-sizing, so much so that in 2009 the number of machines and total turnover were more or less halved (570,000 units worth 56 billions). 2010 should close with a slight recovery (686,000 units for 65 billion dollars).
In outlining the world market scenario for earth moving machinery and vehicles, it is very important to understand evolution of the market between 2005 and 2009. China provided an enormous impulse in passing from 18% to 43% of world demand, while North America collapsed from 28% to 13%.
The structural and geographical changes on the market are especially evident with reference to 2005, when North America was the largest world market with 28%, Europe took 20%, China 18% and India 3%.
In just 4 years, 2009 was North America cover 13% of the market, Europe 15%, China 43% and India 5%.
These figures highlight that as North America and Europe turned in the worst performance since the 1990s, we are also witnessing a decisive shift in production and purchases from West to East.
While sales envisaged for 2014 in Europe and North America will be 123,500 and 128,500, the same posted in 1998/99 and 1994/95, China alone will purchase 326,400 machines and India will leap from 29,000 in 2009 to 63,320 in 2014.
Source: Samoter Press Room