Construction machinery in France: back on the high ground

The French market witnessed a similarly positive global economy, with markets up 16% in the EMEA region (Europe, Middle East, Africa), +10% in North and Latin America, +11% in Asia-Pacific, and finally +74% in China, with this country picking up briskly following a severe drop from 2011 to 2015.

According to the figures gathered for Seimat and Cisma (French association of equipment manufacturers for construction, infrastructure, steel and handling equipment industries), sales of equipment in France benefited from an improving general economic backdrop and in particular an improvement in the building sector, at +4.7%, and public works, at +2%(*).

The impact of compact

“Contractors have exercised restraint in their demands,” notes Jean-Marie Osdoit conservatively. They took advantage of the provisions of the Macron Act allowing them to overdepreciate productive investments, but without going to extremes, thereby avoiding a negative blowback on the capital investment market. “In the “large machines” category, they often made do with simply replacing items in their fleet, rather than increasing their fleets,” explains the Seimat chairman. The figures presented by Seimat confirm this analysis, considering that “heavy” earthmoving machinery saw an increase of 16% as against growth in the compact equipment in the same category of +22%.

This gap illustrates the underlying growth trend in the compact market – sales of mini excavators accounted for 53% of all earthmoving machinery sales in 2017, compared with only 29% in 1998. It also illustrates the growth in equipment rental, whose weight Seimat gauges every year on the mini excavators, midi excavator, skid steer and sub-5,500 kg-wheeled loader markets. Altogether, these figures indicate a 29% increase in sales to rental companies, higher than the rise recorded by compact earthmoving equipment as a whole. It is also true that since it offers immediately-available equipment, rental also traditionally overreacts to trend changes in the construction industry.

A total of 11,574 mini excavators were thus sold in 2017 (+24%) and 1,480 compact loaders (+36%). Midi excavators – 1,773 units sold in 2017 – have not lived up to the growth expectations that were trumpeted when they arrived on the market, observes Jean-Marie Osdoit. This is undoubtedly due to competition from two rivals: wheeled mini excavators under 6 t and medium tonnage wheel excavators, which manufacturers are continuing to bring out in every greater numbers, says the chairman. “The growing demand for city centre works has fuelled the sales of these wheeled vehicles.” The sales of wheeled excavators of 11 t and above increased by 25% to reach 968 units, while crawler excavators above 12 t recorded a ‘mere’ +16% with 2,231 units sold.

Concrete trucks leading the way

Road building and utility networks machines are experiencing a comeback, with 13,818 units sold (+21%) and +26% for steered rollers alone.

The healthy state of the building sector has stimulated the sales of equipment for concrete, with 1,353 units sold (46%), and mainly mobile concrete mixers – 1,203 units sold (+48%). Displaying flattering figures, mixer pumps and mobile or fixed concrete pumps are still not much in demand in France. This is a cause for concern to Jean-Marie-Osdoit, who believes that building sites would benefit from using this type of machinery which is very popular in Germany.

The recorded sales of lifting, handling and powered access equipment – telehandlers, aerial work platforms and mobile cranes – increased by 12%, with +12% for telehandlers (7,134 units) and for powered access (6,968 units).

Between +4 and +8% for 2018

So what does 2018 hold? Seimat forecasts an increase in sales of between 4.1% and 8% to reach between 52,300 and 54,200 units, with +5% in earthmoving, (+9% for “large” machines, +4% for compacts), +1% for roadbuilding machines, +3.5% for concrete equipment and +5.5% for lifting, powered access and handling. The major project effect, in particular that of the Grand Paris projects, will undoubtedly support sales. “But this type of effect never accounts for more than 10% of annual sales of public works machines in volume,” argues Jean-Marie Osdoit.

“Growth will continue, but at a slower pace. We are arriving at a levelling-off point, before the cycle flips over, perhaps in 2019 or 2020.”

* See “+ 4.7% for the building sector in France in 2017, and growth set to continue in 2018” and “Upturn in public works to accelerate in 2018”, Intermat Blog, December 2017.