The construction and equipment rental service markets are expected to grow stronger in almost all of Cramo’s market areas in 2011. According to the forecast published by the construction market research organisation Euroconstruct in June, construction activity will grow by some 4-6 per cent throughout the Nordic region. In Lithuania and Russia, market growth is predicted at 5-7 per cent and in Germany, at just under two per cent. Growth rates in the double figures are forecasted for Poland and Estonia. In Latvia, the market will remain unchanged. In Hungary, the Czech Republic and Slovakia, construction is expected to decline.
However, most recent economic development indicates increased uncertainty, and therefore the forecasts above have to be interpreted with considerable caution.
Cramo’s experience shows that changes in the equipment rental market follow changes in construction activity with some delay. Cramo anticipates stronger growth in the demand for rental services compared to that in construction. Increased interest in equipment rental as an alternative to owning will contribute to the growth of the rental market. Recent history shows that arrangements where companies outsource their equipment fleet to a rental service company are becoming increasingly attractive.
The recent debt crisis in certain eurozone countries has increased the uncertainty of near-term future economic development in Europe. This has also increased the risk levels associated with Cramo’s business operations.