A conference in Venice found the Board of Directors of Roto Frank in bullish mood despite market conditions, Michael Gannon reports
The report was made to the Ninth International Trade Press Day where 65 journalists from 16 countries attended.
However, despite the success, 2014 turned out to be a “weak year for markets”, characterised by negative trends, according to Eckhard Keill, Roto’s Chief Executive. His pessimistic prognosis was that “2015 will be much the same”.
He went on to state that the aim had to be once more to outperform markets and competitors. “When we predicted that 2014 would bring lateral movement of markets at best, rather than upward tendencies, we were blamed for being too negative. Now we know that we had actually been too optimistic”, he asserted.
According to the Roto CEO, the most relevant markets had seen “rather steep losses”. In comparison, the Roto Group has been able to keep up its positive business performance and ensure economic stability. The main factors of success was put down to a strict customer benefit focus and the global implementation of “German made” values.
Among other factors, numerous political crises had led to lowered forecasts in 2014, e.g. China is experiencing its lowest growth rate (7%) in 25 years and Europe “is languishing” at best. Dr Keill stated the Russian economy was suffering from sanctions imposed as a reaction to the Ukraine conflict. The “only ray of hope” for him was the recovery in North America and a better than predicted improvement in the UK.
He criticised developments in Germany, where slowing growth rates seen in 2014 and expected for 2015 were largely “home grown problems”.
Perhaps contentiously, he insisted that it was “evident that the German government’s ‘soft-touch policies’ point in the wrong direction. For example, handing out generous “social presents” at the expense of urgently needed investments into infrastructure and energy efficiency.”
The rest of Europe offered, at best, only moderate signs of recovery from the recession.
Though the total construction volume in the 19 ‘Euroconstruct’ countries is expected to grow again from 2016, it would still be below 1998 levels. “This moderate growth will supposedly be triggered by residential construction, which is characterised by strong country-specific disparities,” said Eckhard Keill. “According to research institutes, Ireland, the UK, Hungary and Poland will be at the forefront, while Belgium, Denmark, Germany and Switzerland will only be mid-range. Finland, France, Norway, Spain and the Czech Republic will be the bottom of the table due to a decline in residential construction.”
On the face of it, Keill’s forecast for the window and door markets was pessimistic with a sharper decline than what had been expected a year ago. No general turnaround was to be expected in 2015 and some overseas markets “seem to be a real unknown quantity”.
The first session struck a number of the English journalists as a little strange with a perhaps overlong focusing on Roto on a report it had at the fensterbau exhibition in Nuremburg earlier in the year.
Perhaps it showed on our side that we were not fully aware about the importance that the event has for companies in Europe. But, no doubt, the findings showed a consistently high rating in terms of appreciation of the products and services on the Roto stand. On the other hand, it appeared a little too self-congratulatory to form such a large part of the morning session.
An analysis of the market was put forward by Francesc Gimeno, the Managing Director for the Window and Door Technology Division Southern Europe.
He concentrated on the fortunes of France, Italy and Spain.
Given the bad coverage France has had in recent times, it came as a surprise to hear that compared with Italy and Spain, Gimeno reported “France has weathered the crisis quite well”. The volume of new buildings had only decreased by 9% since 2009.
Forecasts for 2014 estimated the French window market at 10 million units, 56% of which would come from refurbishment and 44% from new build. Only 2017 will bring a discernible increase in new projects. There was a clear preference for certain window materials on the French market. PVC-U is the number one with 62%, followed by aluminium (23%) and timber (15%).
The standard window in France is two-sash, 1,000mm x 1,000mm, turn-only, double glazing, 30kg–60kg sash weight, ‘U’ value 1.3, low safety level, white.
Just like the Italian market, France is increasingly feeling the impact of imports from Poland. In 2011 to 2013 alone, these imports increased by 30% to 600,000 units. According to the regional Managing Director, key trends on the French window market are energy efficiency, automation, design, ventilation and security.
With an estimated 118,000 new houses to be built in 2014, Italy has seen a slump of more than 50% since 2009.
Window sales volumes have dropped to roughly 6 million units, with refurbishment accounting for two-thirds and new buildings for one-third. New construction business is predicted to pick up again in 2016. The material mix on the Italian market – timber is number one with 43%, followed by aluminium (35%) and PVC-U (22%).
Gimeno opened his presentation on the Spanish market by pointing to the “collapse of new construction business” in Spain.
There has been a slump of 85% since 2009, bringing the sector almost to a complete standstill. Window sales have also seen a sharp decline from 7.9 million (2010) to 3.7 million units. While the renovation sector still amounts to 2.4 million, new build only accounts for just over one million units of total sales volume. According to forecasts, the new construction sector will only begin to recover in 2017. Aluminium dominates the Spanish market (57%), followed by PVC-U (35%) and timber (8%).
Despite the challenging and quite distinctive market conditions in the Southern European area, Roto’s product portfolio for the Southern Europe region has been developed to meet country-specific requirements and the latest trends on the window market.
The key trends have been energy efficiency, design, ventilation, safety and security, larger and heavier elements, and automation. The convenience ventilation system E-Tec Drive combines several of these trends.
GERMANY – SECURITY CAMPAIGN
According to Marketing Manager Udo Pauly, Germany is referred to as a “paradise for burglars”.
The number of such offences has been increasing since 2008 to 150,000 cases in 2013. Detection rates are “extremely low” at only 15.5%. That means that only one out of six cases can be closed successfully by the police.
Quite a few of us English journalists could have pointed Udo Pauly to look at the figures for the UK when it comes to reporting (or not) crimes, including burglary by the police.
However, Roto believes it will be in the vanguard of a fightback against burglars with the promotion of its campaign Resistance is not futile which was launched at the conference last month.
This has been followed by direct mailing, press work and advertisements in relevant specialised media in Germany. Promotion packages will be provided to participating businesses to support point-of-sale activities.
Other measures will be introduced to promote Roto Quadro Safe for facade windows which is based on components from the universal Tilt & Turn hardware portfolio Roto NT. The four-pack for efficient protection against picklocks consists of lockable handles, anti-drilling protection, mushroom cams and security strikers.
Depending on the experience in Germany, this scheme may be introduced in other countries where Roto is active.
As with previous conferences, time was given to the place where Roto had chosen and few could be unimpressed by the buildings in Venice.
Professor Stefano Croce was the expert on what had been achieved in this unique city. Buildings have had to be squeezed into an area of just 35km², including ancient churches, palaces and merchants’ houses. Croce believed that “no other city in the world has such density of historically significant architecture”.
Nevertheless, it was very evident that the city has problems to deal with – maintaining its beauty and grandeur but fighting against decay and the very serious threat of flooding. Yet, as Croce pointed out “Venice without water” would be unthinkable.
The city’s founders had settled in the Lagoon while the Roman Empire was disintegrating about them and learned to live with the tides. There were no roads, bridges, plazas but only waterways. The most stunning buildings are strung along these waterways, “with façades that have preserved the staggering diversity of artistic styles for generations to come”, said
The next Roto conference in 2015 will be held in Vienna.
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The beautiful location of Venice was the destination for the latest Roto Conference for the trade press. Our image shows the Palazzo Grimani which was built at the height of the Renaissance period.
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Eckhard Keill, Roto’s CEO – the most relevant markets had seen “rather steep losses”.
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The table shows the differences between the major countries of Roto’s Southern Europe region.
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Germany has seen the launch of a major security campaign which, if successful, could be introduced into other countries where Roto is operating.