R Finpro Pulse 09 Survey In Machinery 090320 Final


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R Finpro Pulse 09 Survey In Machinery 090320 Final

  1. 1. Main findings of Finpro 09 Pulse Survey Executive Summery in Machinery sector Finpro CSE January-February, 2009
  2. 2. 1. Background & investigated areas Background • Finpro CSE has contacted the relevant associations and major companies in • Construction, • Logistics & • Machinery sector • The geographical coverage was Central and Southeast Europe, as in following countries • Austria • Czech Republic, • Slovakia • Hungary • Slovenia • Croatia • Serbia • Romania • Bulgaria • Turkey • Around 100 managers were interviewed • The phone-based survey was conducted in February 2009. • Special note: the Survey is not based on representative primary research, it just gave some “feelings” & summarize some subjective thoughts from market players` point of views. © Finpro ry / 2009
  3. 3. 2. Main findings from Finpro Pulse 09 survey Pulse 09: Machinery 6,0 5,0 4,0 3,0 2,0 1,0 0,0 Performance Openness Notes: • Scaling at sector performance from 1 (deep recession) to 7 (healthy growth) • Scaling at sector openness from 1 (no opportunities to launch new technologies & business model) to 7 (lucrative business to come up with new technologies & business models) © Finpro ry / 2009
  4. 4. 3. Major comments from the region Country Sector performance Major problem in the Major opportunity in your sector sector Strongly linked to the building happening. The fall in exports to Building economically , i.e. Romania, Bulgaria, Ukraine, utilizing the advantages of the Expect among other things initiatives from Poland and Hungary steel structure compared to the public institutions for economic massive construction and timber recovery. So far the extent of utilization of construction. the companies is still satisfying. Austria By substantial conversion to Strong break-downs of building activity international regulations and particularly in the new EU states are standards (EURO CODE) however expected. reducing of the competition of cheap suppliers from south and Eastern European states Dramatic situation, expect it to be much Lack of projects Very difficult to say, investors worse then 2008 Demand of steel has gone are scared, but infrastructure down in several industries. remains an option Whole industry is suffering and probably this will continue until the end of 2009 Automotive sector is Surprisingly construction sector Czech affected the worst. seems to have still steady Republic demand due to infrastructure projects © Finpro ry / 2009
  5. 5. 3. Major comments from the region Country Sector performance Major problem in the sector Major opportunity in your sector Extremely difficult times. They monthly Market is over saturated with all No real opportunities at the TO is EUR 30 000 and they need EUR kinds of products, industries are moment 120 000 just to survive, and not let go too dependent on one another people. They are not the only Qualified & cheap workforce, company in that situation. Instability, dead market but no real opportunities Slovakia Extremely difficult for companies whose business depends on the automotive sector. They still have work to do, but it all comes from Hungary, companies with only Slovak customers have no new projects coming. Nothing happening in the market Majority of Hungarian companies Lack of quality labour (engineers), Open to the Russian market, working as sub-contractors for lack of quality material Acquisitions on the market: Western companies (many Small companies are in the Scandinavians as well), 30-40% Problems at Clients in Western target capacities would be free EU, Hungarian machinery sector strong linked with German & Consolidation, EU-fund driven -15-20% decrease Austrian markets construction works Hungary -20-25% free capacities will be avalable Deeper recession, company Cleaning the market & bankruptcies at underfinanced or consolidation --> cost efficient & -35-40% free capacities will be strongly bank-linked companies reliable companies will survive available, SME`s financial problems Clients have financial program to Consolidation as cleaning the get loan from banks market & acquisitions © Finpro ry / 2009
  6. 6. 3. Major comments from the region Country Sector performance Major problem in the sector Major opportunity in your sector Don't know. Maybe government helps No orders, no work to do, 30-40% drop Really bad. Members estimate a drop financially some projects that influences in employment of 40-60%. positively to this sector as well. Lack of orders. Sales drops. Slovenia Generally markets go down. This Going down maybe 20%. company tries to survive the first wave of companies collapsing and when there are fewer players on the market it is easier to get orders. -50% drop, Clients (German, Austrian, Financial problems at Austrian & More activities outside EU (e.g. Arabia, French) in problem German Clients Iran) -20 % drop, end-clinets troubles in No orders Market consolidation & new markets in Croatia Germany (70-80% of Croatiaq export) the 2nd half 2009 Increasing orders from major export market (Germany) EU financed projects, market consolidation Nothing much happening in the sector Foreign investors may decide to cease A lot of companies to be privatized: at the moment, waiting for the operation due to the crisis (Fiat might FAP, 14 oktobar… privatization to take place partially close down from March, US Steel as well) Further privatization Sector is pretty dead, for example: last Serbia year 750 new freight railway carriages Law and legislation is the biggest were bought, but 0 plans for this year, 0 problem, especially extremely strict HR plans for production as well laws where privatization is concerned. CEO is Slovak, he says they are much stricter then in the rest of the Europe © Finpro ry / 2009
  7. 7. 3. Major comments from the region Country Sector performance Major problem in the Major opportunity in your sector sector The number of the equipments delivered Financial problems (cash 4 billion Euro will be available till 2013 from in 2008 increased only by 7% compared to flow) UE funds to be invest in infrastructure projects 2007, the same situation will be also in (roads and railways) Orders from the strategic 2009 clients will drop in the first Diversifying the products and establishing new We expect good performances. Our sector half of the year. partnerships with the clients we had to refuse is not affected directly by the economical earlier. lack of subcontracting work crises. We do not depend on certain Romania opportunities for foreign clients or sectors. no real opportunities at this moment in the international companies; lack machinery sector; General recession (30- 40% drop due to of liquidities; the decreasing orders from major foreign New highways - his clients will sell more non-paid invoiced and late clients); focusing on revitalizing the sales machineries and also spare parts will be payment, difficult to take channels; needed loans 30% less orders in 2009 compare to 2008 Sector is mainly export oriented and there Less orders, which will lead Ideal time for well established foreign is decrease in order stock from foreign to closing down of some investors to begin new operations in Bulgaria partners. factories and increase of due to more predictable cost structure. Easier unemployment. to find outsourcing partner due to free 20-30% free capacity production capacities. Decrease in orders, definitely Restructuring of the sector, more efficient there will be some Machinery sector is very dependent on operations. Bulgaria bankruptcies of smaller export, so it will experience serious companies. Development of new products; restructuring of difficulties in 2009. the sector and consolidation. Only good and Slowdown in construction and efficient companies will survive. related sectors will lead to less orders. Finding new markets and partnerships. It will be difficult to keep the Healthy companies will manage the problems employees in house due to of the global economic slowdown. decreasing orders. © Finpro ry / 2009
  8. 8. 3. Major comments from the region Country Sector performance Major problem in the Major opportunity in your sector sector Expecting to keep 2008 level Demand shortage and Positive enlargements in suspend in investments Russia and Central Asian It is expected that the Turkish Countries machinery export will slow Shrinking of domestic down in 2009 due to the and foreign demand The movement in the global financial crisis. There markets of the neighbor Turkey will be a downturn of 25% in countries. internal market. But in the Willingness of the Turkish second half of 2009 it will companies to produce high take an upward trend and technological and value could catch the performance added products. of 2008 in 2010 and 2011. © Finpro ry / 2009