WINDOW MARKET
PVC windows take over market leadership in Eastern Europe / Envisaged EU entry fuels economy
In 2001, the window market in the CEEC-5 countries declined by -0,8% in quantity; a decline of this magnitude is also predicted for 2002 in total. The declining Polish market is solely responsible for this, however, while in Hungary, the Czech Republic, Slovenia and Slovakia real market growth can be noted, as shown in the latest market study by the consultants of InterConnection Consulting Group (IC, Europa: A-1040 Wien; www.interconnectionresearch.com).
Altogether, around 9.6 milllion window units were sold in 2001 in the five markets examined, which is approximately comparable to the French market (10.4m). While the Polish market shrunk by 9.0% with 4.8m windows, significant growth was achieved in Hungary (+7.5%), the Czech Republic (+13.6%), Slovenia (+4.9%) and Slovakia (+2.9%). In terms of frame materials, PVC windows were able to take over the lead market position for the first time, and reached a quantity market share of 43.3% in 2001, followed by wood windows with 41.8%. Metal windows in various types of construction achieved a market share of 13.0% in Eastern Europe; wood-aluminum combinations, with 2.0% of the market, are still relatively under-represented.
Slovakia: Nearly 50 % of frames from PVC
In Slovakia, a market with about 560.000 window units in 2001, growth of 7.0% is expected for 2002 and 8.6% for 2003. After years of big projects in property construction, this segment is once again declining, as most headquarters of large banks and insurance companies are already completed. All manufacturers expect significant impulses from the elections taking place in fall of 2002 (foreign investments, increased apartment construction), but this shot – assuming corresponding election results – could also backfire. In the market for multilevel housing, there is great pricing pressure on the part of construction companies; generally, due to overcapacity, in spite of rising material costs no more price increases can be enforced. Certificates do not yet play a role for end consumers, so smaller manufacturers can achieve market success with lower demands on quality and push prices further down. For the first time, mortgage bonds with interest rates between 9.95 and 11% per year are available to private persons, minus the subsidy of 4.5%. In Slovakia, in 2001, 46.9% of all windows sold were already made of PVC; the market share of wood windows was only 34.2%.
Czech Republic: Demand for higher quality
After the recovery from the economic crisis in 2000, 2001 was a very good year for the Czech window industry, in terms of quantity, the market rose by 13.6% to about 1.7m window units. Due to increasing energy costs, products of increasingly higher quality are succeeding on the Czech market. As in other markets, prices are under pressure, so the TOP 10 manufacturers had to lower their prices in 2001. The level of government funding for renovating panel buildings varies from year to year. As in the German-speaking countries, large areas guarded from development using PVC- windows by regulations for “protection of monuments” (e.g. the old part of Prague). The expectations for the coming years indicate a “breather” for the market this year and then once again growth rates of over 8% for the years 2003 and 2004. In the Czech Republic PVC-windows have also clearly taken over leadership of the market with a market share of about 49%.
Hungary: Still high percentage of wooden frames
The Hungarian market was also able to keep up its good growth rate in 2001 and should be able to again achieve growth rates of up to 7% by 2004, after a slight sag in 2002. The main reason for growth is, as before, the Szechenyi-plan adopted in 2000. In the last 2 years, 32.5 bn Forint, or EUR 138m, were invested into financing for private housing . The aim of the old and probably also the new government is to build 40,000 new housing units annually until 2005. In Hungary, the tendency towards higher-quality buildings is slowly starting to set in; the funds for this can increasingly be found in savings and loans associations. There is also a good cushion due to more building permits. In Hungary, wood windows have the most say in terms of market share, 46% of all windows sold in 2001 were wood, it is expected that this figure will hold up relatively well in 2004, with only a slight decrease to 44%.
Slovenia: Higher imports from Austria and Italy
In spite of good domestic demand, the Slovenian market is suffering from the weak exports of the traditionally strong wood-window industry in the German-speaking countries. The PVC-window market in Slovenia is increasingly coming under the control of Austrian and Italian manufacturers, who want to compensate their weak domestic markets by increased exports to Slovenia. Altogether, in Slovenia in 2001 about 409,000 window units were sold, a plus of 4.9% compared to the previous year. In wood country Slovenia, wood windows also continue to hold leadership of the market with a quantity market share of 47.6%, a high value, which however was still over 56% five years ago.
Outlook
In the medium term, the consultants of InterConnection expect growing markets in Eastern Europe; by 2004, starting from 2001, an 8.7% growth in quantity and a 4.9% growth in value are predicted. PVC (+13.3%) and metal windows (+8.8%) are considered to be the cause of growth, and for wood windows a growth in quantity of +2.8% is expected. Looking at growth predictions of individual countries, the different development of the market appears most clearly: by 2004, growth of 17.2% is predicted for Hungary, a plus of 20.7% for the Czech Republic, +10.8% for Slovenia and for Slovakia +28.7%, while the Polish market will again decline by a total of -2.1% by 2004. The question mark over these predictions, however, remain the successful completion of all chapters of the EU entry negotiations of the candidate countries as well as the scheduled entry in 2004. A delay in the EU entry would represent a severe setback for foreign investments into the candidate countries and bring about a negative market psychology.
The “IC-Market Monitor Panel Windows in Eastern Europe 2001” is a detailed market and sector analysis of the window market in the CEEC-5 countries. It contains market figures in quantity and value for the years 1997-2001 and development predictions until 2004, detailed sales and turnover figures as well as market shares of the TOP-50 manufacturers in Eastern Europe.
Altogether, around 9.6 milllion window units were sold in 2001 in the five markets examined, which is approximately comparable to the French market (10.4m). While the Polish market shrunk by 9.0% with 4.8m windows, significant growth was achieved in Hungary (+7.5%), the Czech Republic (+13.6%), Slovenia (+4.9%) and Slovakia (+2.9%). In terms of frame materials, PVC windows were able to take over the lead market position for the first time, and reached a quantity market share of 43.3% in 2001, followed by wood windows with 41.8%. Metal windows in various types of construction achieved a market share of 13.0% in Eastern Europe; wood-aluminum combinations, with 2.0% of the market, are still relatively under-represented.
Slovakia: Nearly 50 % of frames from PVC
In Slovakia, a market with about 560.000 window units in 2001, growth of 7.0% is expected for 2002 and 8.6% for 2003. After years of big projects in property construction, this segment is once again declining, as most headquarters of large banks and insurance companies are already completed. All manufacturers expect significant impulses from the elections taking place in fall of 2002 (foreign investments, increased apartment construction), but this shot – assuming corresponding election results – could also backfire. In the market for multilevel housing, there is great pricing pressure on the part of construction companies; generally, due to overcapacity, in spite of rising material costs no more price increases can be enforced. Certificates do not yet play a role for end consumers, so smaller manufacturers can achieve market success with lower demands on quality and push prices further down. For the first time, mortgage bonds with interest rates between 9.95 and 11% per year are available to private persons, minus the subsidy of 4.5%. In Slovakia, in 2001, 46.9% of all windows sold were already made of PVC; the market share of wood windows was only 34.2%.
Czech Republic: Demand for higher quality
After the recovery from the economic crisis in 2000, 2001 was a very good year for the Czech window industry, in terms of quantity, the market rose by 13.6% to about 1.7m window units. Due to increasing energy costs, products of increasingly higher quality are succeeding on the Czech market. As in other markets, prices are under pressure, so the TOP 10 manufacturers had to lower their prices in 2001. The level of government funding for renovating panel buildings varies from year to year. As in the German-speaking countries, large areas guarded from development using PVC- windows by regulations for “protection of monuments” (e.g. the old part of Prague). The expectations for the coming years indicate a “breather” for the market this year and then once again growth rates of over 8% for the years 2003 and 2004. In the Czech Republic PVC-windows have also clearly taken over leadership of the market with a market share of about 49%.
Hungary: Still high percentage of wooden frames
The Hungarian market was also able to keep up its good growth rate in 2001 and should be able to again achieve growth rates of up to 7% by 2004, after a slight sag in 2002. The main reason for growth is, as before, the Szechenyi-plan adopted in 2000. In the last 2 years, 32.5 bn Forint, or EUR 138m, were invested into financing for private housing . The aim of the old and probably also the new government is to build 40,000 new housing units annually until 2005. In Hungary, the tendency towards higher-quality buildings is slowly starting to set in; the funds for this can increasingly be found in savings and loans associations. There is also a good cushion due to more building permits. In Hungary, wood windows have the most say in terms of market share, 46% of all windows sold in 2001 were wood, it is expected that this figure will hold up relatively well in 2004, with only a slight decrease to 44%.
Slovenia: Higher imports from Austria and Italy
In spite of good domestic demand, the Slovenian market is suffering from the weak exports of the traditionally strong wood-window industry in the German-speaking countries. The PVC-window market in Slovenia is increasingly coming under the control of Austrian and Italian manufacturers, who want to compensate their weak domestic markets by increased exports to Slovenia. Altogether, in Slovenia in 2001 about 409,000 window units were sold, a plus of 4.9% compared to the previous year. In wood country Slovenia, wood windows also continue to hold leadership of the market with a quantity market share of 47.6%, a high value, which however was still over 56% five years ago.
Outlook
In the medium term, the consultants of InterConnection expect growing markets in Eastern Europe; by 2004, starting from 2001, an 8.7% growth in quantity and a 4.9% growth in value are predicted. PVC (+13.3%) and metal windows (+8.8%) are considered to be the cause of growth, and for wood windows a growth in quantity of +2.8% is expected. Looking at growth predictions of individual countries, the different development of the market appears most clearly: by 2004, growth of 17.2% is predicted for Hungary, a plus of 20.7% for the Czech Republic, +10.8% for Slovenia and for Slovakia +28.7%, while the Polish market will again decline by a total of -2.1% by 2004. The question mark over these predictions, however, remain the successful completion of all chapters of the EU entry negotiations of the candidate countries as well as the scheduled entry in 2004. A delay in the EU entry would represent a severe setback for foreign investments into the candidate countries and bring about a negative market psychology.
The “IC-Market Monitor Panel Windows in Eastern Europe 2001” is a detailed market and sector analysis of the window market in the CEEC-5 countries. It contains market figures in quantity and value for the years 1997-2001 and development predictions until 2004, detailed sales and turnover figures as well as market shares of the TOP-50 manufacturers in Eastern Europe.
03.04.2003 Plasteurope.com [14844]
Published on 03.04.2003