Europe Construction Chemicals Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Europe Construction Chemicals Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The Europe Construction Chemicals Market was valued at USD 15,936.44 million in 2020 and is expected to grow with a CAGR of ~4.98%, during the forecast period (2021-2026).

The market is negatively impacted by COVID-19 in 2020. The construction industry is one of the industries that are badly impacted by COVID-19. Because of a lack of funds, labor shortage, and lockdown regulations, many projects were halted in 2020. Due to a ban on inter-state travel, an exodus of migrant workers, also known as informal sector workers, wreaked havoc on the supply chain. This caused less consumption of different construction chemicals from various respective applications and decreased their demand and supply in the region. Moreover, many end-user sectors and manufacturing factories related to building construction applications were temporarily stopped in the region, keeping in mind the concerns of the workers in the industries. Owing to all these factors, the construction chemicals market in the European region is hindered by the impact of COVID-19.

Key Highlights

• Over the short term, growing construction activities in the region, increased adoption of innovative construction procedures, as well as, rising demand for water-based products are expected to drive the market's growth.
• Regulations for VOC emissions and unfavorable conditions arising due to COVID-19 pandemic are expected to hinder the growth of the market studied.
• By end-user industry, residential segment dominated the market and is expected to grow with fastest rate during the forecast period.
• Increasing focus on sustainable materials is likely to act as opportunity for the market studied, through the years to come.

Key Market TrendsResidential Sector to Dominate the Market

• The residential construction comprises both luxury housing and middle-class house segments.
• Elite class is synonymous with luxury, and elite housing refers to luxurious residences. The demand for apartments, penthouses, villas, and bungalows in gated communities with world-class designs and amenities is increasing rapidly, and the developers are launching projects to cater to such demands.
• Architects are producing new innovative elite housing ideas to cater to such demands. To overcome the challenges in the new and innovative elite housing projects, construction chemicals are used in a huge quantity.
• Elite housing is also evolved with emerging technologies in construction.
• The construction industry has started using 4D virtual reality models to fully immerse the owners in the environments of the construction during the planning and design stages. Making the buyers walk through a fully interactive immersive experience before finalizing plans allows them to win buy-in and produce plans that fully meet the expectations. Augmented reality allows users to walk through real 3D environments with their feet while gathering and viewing additional real-time information about that house. Due to these technological advancements, elite people are tempted to construct new luxury houses.
• The residential construction industry in Germany is on the rise, even after the covid effects of 2020. The construction industry output increased by 2.8% in 2020. The turnover decreased in Q1 2021. In 2022, the residential construction activity is expected to have a rebound of about 2.5%.
• According to the Federal Statistical Office, turnover in building completion work was up 9.1% in the third quarter of 2021 compared to the third quarter of 2020.
• According to Eurostat, construction cost of new residential buildings was 9.40 % year-on-year in September of 2021.
• The rising middle-class population, coupled with increasing disposable incomes, has facilitated an expansion in the middle-class housing segment, thereby increasing the use of construction chemicals in the segment during the forecast period.
• Thus, the increasing residential construction in Europe is expected to positively impact the construction chemicals market in the forecast period.

Germany to Dominate the Market in European Region

• Germany had the largest market for construction chemicals in Europe, which is expected to increase during the forecast period. Germany has the largest construction industry in Europe.
• The country has been continuously investing in quality infrastructure and has one of the best infrastructures in the world. According to the World Economic Forum’s Global Competitiveness Report in 2019, the country ranked 8th in terms of infrastructure index in the period, 2018-2019, gaining two places from 10th in 2017-18.
• Germany has the largest construction industry in Europe. The construction industry in the country has been growing at a slow pace, majorly driven by increasing new residential construction activities. According to industry experts, completion of the construction of new houses was estimated at 306,376 Units in 2020 as compared to an increase from the previous number of 293,002 Units for 2019.
• In addition, during 2020, the domestic construction sector recorded robust growth of about 6%, in terms of revenue. The trend is predicted to remain the same for the next two years, due to expected impact of growth in residential construction and public investment.
• The non-residential and commercial buildings in the country are expected to witness significant growth prospects during the forecast period. The growth is likely to be supported by lower interest rates, increase in real disposable incomes, and numerous investments by the European Union and the German government.
• In May 2020, the construction of a total of 32,000 apartments with building permits was approved in Germany. According to provisional data, the Federal Statistical Office (Destatis) further reports that this was 3.9% more building permits than in May 2019.
• According to Statistisches Bundesamt (Destatis), the construction of new dwellings increased to 327.26 thousand in 2020 compared to 317.82 thousand in 2019. The construction industry registered a significant growth in the country despite a severe impact by the pandemic.
• In the third quarter of 2021, the country have starter the construction of the Central Hospital in Lörrach, Baden-Wuerttemberg with the investment of USD 418 million and is expected to be completed by 2025. The project aims to build a center for mental health and a medical department store with a parking garage.
• Additionally, the German Government and national railway company Deutsche Bahn have agreed to invest approximately EUR 86 billion into rail network maintenance over the next ten years. Overall, all such factors are expected to drive the construction industry in the country, which in turn, will drive the market for construction chemicals through the forecast period.

Competitive Landscape

The construction chemicals market in Europe is partly consolidated in nature, with the top 5 companies occupying a regional share of ~47%-49%. The prominent companies in the market are using different strategies (such as mergers, acquisitions, joint ventures, agreements, collaborations, and the expansion of production facilities) to meet consumer demand. ​The major players in the market studied include Sika AG, MBCC Group, MAPEI S.p.A., Dow, and RPM International Inc., among others.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support

Companies Mentioned

IBM Corporation
Oracle Corporation
Internap Corporation
Packet Inc. (An Equinix Inc. Company)
Scaleway Inc.
Amazon Web Services Inc
Rackspace Inc.
CenturyLink, Inc.
LightEdge Solutions, Inc

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