The overall market for infrastructure pipes in Europe recorded another drop of 4.4% in 2015. Overall, the market value of 2015 reached a volume of 4.6 billion Euros, which is only 0.4% above the previous years figure. The recently released market report by Interconnection Consulting forecasts a consistent sales volume in 2016 compared to the previous year. The replacement of old metal and concrete pipes paved the way for alternative materials such as glass fiber and plastics.
No state, no orders
In recent years, the EU infrastructure pipeline manufacturing sector has experienced the loss of some jobs and domestic market shares. These are heavily dependent on government spending and funding, which have been massively cut in some countries. Germany, the largest market for infrastructure pipelines, showed a 5.4% decrease in installed pipes. The British market also fell by 1.7% in 2014. Due to the positive exchange rate, however, the British achieved a value increase of 7.9%. The 0.6 billion dollar market in Italy suffered a drop of 6.5% last year. After 8 years of falling sales the Italian market for infrastructure pipes will finally be able to see the light at the end of the tunnel for the first time. As early as this year, increased government investment is expected to boost business volumes in Italy by 2.4%. France also suffered a sharp decline in recent years. While the order volume in 2013 was still more than one billion tons, two years later the volume was below 900.000 tons.
Poland is taking a breather
The market for the pipe industry in Spain is more optimistic as the economic situation is beginning to recover. In 2016, it will go uphill as far as sales and turnover are concerned. In Poland, the savings of the Polish government in 2014 allowed the possibility to release additional financing options, which boosted the market for infrastructure pipes (2014: + 7.9% in value). 2015 was a transitional year, between pre-existing investments and planned investments for new infrastructure facilities resulting in moderate growth (+ 0.5%). The increase is expected to rise significantly this year. In the Benelux countries, public investment continued in 2015, which led to a further decline in the volume of orders. “From 2016 the situation will also be relaxed in the Benelux countries because investments in infrastructure have already been estimated,” says Laszlo Barla, author of the study.
Plastic is leading the race
Last year, a total of 1.5 million tons of plastic pipes (27.4% market share) were sold in the top 7 European countries (France, Germany, Great Britain, Italy, Spain, Poland, Benelux). This year, the turnover of sold plastic pipes is expected to increase by 8.1%. The reasons for this increase can be found in the properties of plastic pipes, such as their resistance to corrosion, flexibility, weldability, chemical resistance and their fast and simple joint and installation techniques, which all mean important cost savings. The growth of the plastic segment is at the expense of the metal and concrete pipe shares, which lost 6.6%. This trend will continue as light materials and plastic alternatives are in demand. The glass fiber tube segment is comparatively small (209.8 million Euros) and is governed by three large players. The future doesn’t look too bright for metal and concrete pipes as their shares are decreasing (-10.2%).
Sewage pipes dominate the market
Sewage pipes dominate the European market accounting for 2.8 million tons and about half of the total sales in 2015. They experience the highest growth opportunities. Drainage pipes, with a share of 41.9%, are the most used pipe type in the England. The non-pressure market prevails over the pressure market taking 64.7% and 35.3% accordingly. The former can boast a sales volume of 2.6 billion Euros. The pressure sector, on the other hand, has less potential as a lot of water networks were already restored. Water supply accounts for the overwhelming majority of 82.7% in the pressure segment. Gas pipes are experiencing negative dynamics and hold only a 6% share of the total market volume.
Market shifts between regional und international
The top 10 among all companies, and thus the largest players on the market, collectively accounted for a share of 27.8% of the total value. There are strong differences across countries. While the French market is in the firm grip of 5 top manufacturers, the Italian market uses a wide range of local production facilities with only a small proportion of imported pipes. The British market is characterized by the strong presence of domestic manufacturers, GPS (a subsidiary of the Aliaxis Group) and Radius Systems (a part of the Polyplastic company). GPF, a leader on the Iberian Peninsula, is one of the European growth champions.