VDMA reports 'joy and sorrow'

A report from the 4293 VDMA (the German Engineering Federation) says that mid-year business situation is highly diverse for companies in the German construction equipment and building material machinery industries.

While some sectors are beginning to approach their record revenue levels of 2007-2008 again, others are still going through “a valley of sorrow.”

The organisation says: “Nevertheless, VDMA is working on the assumption that, thanks to good developments in construction machines, the 10% revenue growth, projected for the entire industry early this year, will actually be higher.

"In 2010 the German construction equipment and building material machinery industries recorded sales of €10.6 billion. Of this amount, €6.3 billion accounted for the construction equipment sector and €4.3 billion for building materials, glass and ceramic machinery.”

During the first half of 2011 sales of construction equipment reflected the average of the past seven years but were still 38% below the record level of 2008. In building material machinery sales were 11% above average and 28% below the record level.

“Although profits are being made in some sectors again, there are no grounds for excessive euphoria,” said Dr Christof Kemman, chairman of the VDMA Construction Equipment and Building Material Machinery Association.

In a breakdown of the various sectors, which include building construction equipment, earthmoving, civil engineering and tunnelling equipment and road construction equipment, VDMA says that in cement, lime and gypsum plants and processing equipment, the cement industry continues to go through a weak period, so that there is no stimulation for equipment and machinery manufacturers.

On the other hand, prospects are clearly more positive for suppliers to raw material extractors and processors. This sector is likely to see an almost two-digit sales growth at the end of the year.

Despite the recent unrest, the most attractive markets continue to be the countries of North Africa. Moreover, positive stimuli are coming from Asia, and in fact not merely from China and India.

After a weak year in 2010, greater growth can be observed in concrete block and slag machinery again.

The industry is expecting to see a good double-digit sales increase compared with last year.

Backlogs are currently so high that 2012 should get off to a good start. The most promising markets can be found in Asia, especially China and India. Business is also developing positively in the CIS countries again despite financing difficulties. North America continues to be unavailable as a sales market