Long Path of Suffering Ahead for the Window Branch
COVID-19 is not only terrifying the world, but also sending the window market in the DACH region (Germany, Austria, Switzerland) into a recession for the next few years. Forecasts show that sales in the window industry will decline by 7.2% in the DACH region in 2020. Between 2019 and 2023, the average annual decline in sales will be one percentage point, as shown in a new study by Interconnection Consulting.
Due to the special situation, uncertainties must be taken into account in the Interconnection forecast. The study figures represent the most realistic scenario at present. Following this scenario, the new construction segment (-7.0% expected for 2020) and the renovation segment (-7.4%) are equally affected by the crisis. The slump in the residential construction segment is particularly hard on the industry, as this area is responsible for around two thirds of sales. Regardless of today’s crisis, combinations will continue to gain ground in the field of frame materials following the trend. Wood / aluminum frames, which had a market share of 14.9% in 2019, will increase their share to 15.6% by 2023. The plastic / aluminum windows will increase in this period from 7.5% to 8.0%. The wooden window, on the other hand, will continue its dramatic decline and will only have a share of 11.8% by 2023. In 2015 it had a share of around 14%.
A Slight Rise in Germany is Expected Only After 2022
German sales in the industry are expected to decline by 6.0% this year compared to 2019. Sales can only be expected to return to the pre-crisis level in 2023. Residential construction in particular is severely affected by the pandemic and its economic consequences- the result being a sharp decline in building completions. The most popular frame material by far is PVC, which accounts for around half of the sales market. Especially between 2015 and 2019, PVC benefited greatly from the new building boom, since public construction projects in particular were strongly driven by the price. Metal is in second place, followed by wooden windows. These are often replaced in the renovation sector by wood / aluminum frames, whose market share is continuously increasing.
Innovative Austrian Market as a Shield Against Crisis
In Austria, too, COVID-19 will send the window industry into recession in the next few years. The average decline in sales will be 0.4% annually until 2023. This will reduce the market value from over 850 million euros in 2019 to 838 million euros in 2023. In the coming years, residential construction will fall back to the level of 2015, which at the same time has strong consequences for the entire window market, which owes two thirds of its turnover to residential construction. The Austrian market has a European unique selling point, in that it is dominated by material combinations. Together, wood / aluminum and PVC / aluminum combinations have a market share of 46.7%. “The innovative capacities of Austrian manufacturers will also be needed to master this crisis,” explains Laszlo Barla, the author of the study.
Sharpest Decline Expected in Switzerland
The recession in the window market is very much on the agenda for Switzerland, too. Between 2019 and 2023, the decline will average at -1.7% annually. From today’s perspective, non-residential construction will get through the crisis faster than residential construction. Wood / aluminum combinations represent over 40 % and are the strongest selling product segment in Switzerland, closely followed by PVC windows.