How is the construction boom? Still there?

2022-09-27 08:57:13

that can also sometimes end with a shovel to the head. And as they say: "light blows to the back of the head increase cognitive ability," which is probably a useful therapy for you?

Where there is no cognitive ability, there is no increase...

On the topic: My sister is an architect in Tyrol at an architecture firm specializing in commercial buildings. They are noticing a significant drop in orders. Books are still fairly well filled but are becoming emptier.

2022-09-27 22:52:06

Take a look at today's latest news about Helma. When such a large entrepreneur stumbles, it bodes ill for the industry as a whole. Because insolvent subcontractors can quickly mean the end for smaller companies if they are not as big as Helma. Therefore, to everyone who is currently building, really good luck that your main contractor does not go bankrupt, because that could become increasingly likely…

2022-09-27 23:43:53

I've been through this theater three times already in my relatively short career as an engineer in special plant construction... 2008-2010 financial crisis 2015/2016 diesel crisis 2020/2021 corona crisis ...and it always follows basically the same pattern... Everyone is sure the world is ending, the good times are over (this time for real, honestly, really now). Orders collapse, bosses look around in panic to see where they can "dispose" of their employees (internal lending, firing, severance, early retirement). Then the world doesn't end after all and you don't know where to put all the work because suddenly everyone is ordering again... but many employees were "disposed of" because everyone was sure insolvency was imminent. In the construction trades there is an additional factor: Companies have been running at 150% capacity for years, so they can't keep up anymore. And even if the books aren't full until the end of 2023 today. Is that the normal course of things? The construction industry has gotten used to being booked out for 2 or 3 years and not having to compete with each other at all. If the customer buys elsewhere, no problem, 20 others are waiting outside... that is by no means normal. Sure, we also have a certain lead time, but it's more in the range of months, not years. If we don't win any orders, it just means nothing is happening for a few months. A company has to be able to endure that.

2022-09-28 00:04:14

I've already been through this drama three times in my actually not-so-long career as an engineer in special plant construction... 2008-2010 financial crisis 2015/2016 diesel crisis 2020/2021 corona crisis ...and it basically always follows the same pattern...

Everyone is sure the world is ending, the good times are over (now really, honestly, for real this time). Orders collapse, bosses look around in panic to see where they can "dispose" of their employees (internally lend out, fire, severance, early retirement).

Then the world doesn’t end after all and you don’t know where to put all the work because suddenly everyone is ordering again... but many employees have been "disposed of" because everyone was sure insolvency was imminent.

In the construction trade there’s an additional issue: The companies have been running at 150% for years, so they just can’t keep up anymore. And even if the books aren’t full until the end of 2023 today. That’s the normal course of things?

The construction industry has gotten used to being booked out for 2 or 3 years and not having to compete with each other at all. If the client buys elsewhere, no problem, there are 20 more waiting at the door... that is by no means normal. Sure, we also have a certain lead time, but it is rather in the range of months, not years. If we don’t win contracts, then a few months go by with nothing. A company has to be able to endure that.

Construction industry here. It’s exactly as you say. Keep a cool head, it will all calm down...

2022-09-28 05:40:28

I agree, but I would like to point out that due to the cheap money of recent years and various legal exceptions, insolvencies of non-profitable companies have almost not occurred. These companies will now probably have to file for insolvency one after the other, as they can no longer finance themselves. I predict a certain market consolidation.

2022-09-28 08:34:38

I do want to point out that due to the cheap money of recent years and various legal exceptions, bankruptcies of unprofitable companies have hardly occurred

But who is supposed to be affected by this? More likely the medium-sized companies, like the mentioned Helma AG. If an insolvency of a subsidiary causes such severe problems for them, then they are running their business much too riskily at the limit. Profit maximization of a public company, after all. The local craftsman is probably affected less. As long as the order books are full, all costs can be nicely passed on to the customers.

How is the construction boom? Still there?

SoL

Sunshine387

xMisterDx

hauskauf1987

Joedreck

Tassimat