Polish road contractors plan to invest in equipment in preparation for recovery

More information on this topic is presented in the PMR report:

Although the anticipated recovery in road construction has yet to materialise, contractors remain moderately optimistic and are confident that an upturn will come sooner or later, both in national roads and local roads construction. And they are planning to invest substantial sums in their machinery fleets to prepare for it.

 

More than 70% of road contractors in Poland plan on making investments in their business in the next 12 months, according to a PMR survey carried out in the spring of 2017 as part of the report Road construction market in Poland 2017: Market analysis and development forecasts for 2017-2022. Investments in construction machinery and equipment were the most mentioned option, cited by nearly two thirds of the surveyed firms – a predictable result given the nature of their business. Nearly half of road contractors also intend to invest in transport vehicles.  

There were very clear differences in the level of investment intentions between small contractors (up to 50 employees) and medium-sized and large companies, though. Significantly fewer smaller firms are planning to invest in their business than larger ones, with particularly noticeable gaps observed in intentions to invest in construction machinery and equipment and in IT infrastructure.

A mere 5% of the surveyed companies stated that they intended to acquire a competitor in the next 12 months. Interestingly, this option was mentioned most often, not by the largest contractors but by medium-sized ones (50-100 employees).

The contractors intending to invest in construction machinery and equipment most often cited lorries, excavators, backhoe loaders, road rollers, and road surface spreaders as the type of machines they planned to purchase. The most mentioned brands were Caterpillar, MAN, Dynapac, Volvo and Mercedes. Other oft-cited brands included JCB, Bomag, Bosch, Hilti and Scania.

We found notable regional differences in the types of construction machinery and equipment that contractors intend to purchase. Companies from the northern, north-western and south-western regions have the most ambitious plans to invest in lorries and excavators; respondents from other regions were more cautious in this respect.

Contractors from the central region, meanwhile, plan to invest more than peers elsewhere in road surface spreaders, including concrete spreaders; and contractors from the eastern region in road rollers, asphalt graders and soil stabilisation machines. 

Disaggregation by dominant customer type also showed significant differences. Contractors who do work for community and county governments and for private customers will invest more than other firms in lorries and excavators, while contractors whose main customers are the General Directorate of National Roads and Motorways (GDDKiA) and the Voivodship Road Boards plan to invest much more in road surface spreaders and road rollers.

About the survey: In the spring of 2017 PMR carried out a poll of construction firms active in the Polish road building sector, interviewing a total of 152 persons holding senior managerial and operational positions. The survey was conducted for the purposes of the report Road construction market in Poland 2017: Market analysis and development forecasts for 2017-2022.


More information on this topic is presented in the PMR report:
Road construction market in Poland 2017. Market analysis and development forecasts for 2017-2022