The global market for extrusion machinery grew by 4.7% in volume last year and will continue to achieve stable growth in the coming years. For example, growth is expected to continue at more than 4.5% annually until 2025, according to a study by Interconnection Consulting.

In 2020, the industry suffered greatly from the effects of COVID. In the process, market volume declined by 0.7% in global volume terms. In the meantime, the momentum of the 2021 catch-up process has slowed down a bit again. The forecast global growth up to 2025 is 5.9% per year.

Europe Falling Behind

China & Taiwan continue to act as the growth driver for the entire industry, with average annual growth of 7.1% up to 2025. The market volume in this market region is EUR 1.7 billion, making it the largest submarket examined. India shows even stronger dynamics with average growth rates of 8.1% until 2025, but with a yet still small market volume of around 170 million euros. North America will also show strong growth in the next few years from today’s perspective, with growth rates of around 5% in volume. The current market volume is around 500 million euros. In Europe, we will have to be content with smaller growth. The rising cost of energy and raw materials, as well as uncertainty in supply chains due to the Ukraine war, will cause investments to decline, which will also reduce demand for extrusion machinery, as Yuliia Hrebenkova, the author of the study, explains. However, with these developments, Europe is also losing significant market share to North America and China.

Sheet vs. Pipe

Sheet extrusion machinery is the top-selling product group, accounting for 32% in value. One reason for its popularity is the universal application of these machines in growing industries, such as packaging and medical, as well as construction and advertising.  In comparison, machines for window profiles are used only in the construction industry. Pipe extrusion machines are the leading product group in volume, with a share of 31%, mainly due to the low price as well as a dynamic global construction industry. There is a large difference between regions in terms of market share for each product segment. In Europe, pipe extrusion leads (35%) ahead of window profiles (31.7%) in China, sheet extrusion leads (30%) and in the USA & Canada, pipe extrusion leads ahead of sheet extrusion (37 and 16% respectively).

High Market Concentration

The total global market volume in 2022 in the global core markets was around 4.4 billion euros. The market for extrusion machinery shows a high level of competitive concentration… The seven largest manufacturers share around 60% of the total market. The study examined the following markets: China & Taiwan, India, South Korea, Japan, Latin America, USA & Canada, France & Benelux, Eastern Europe, Central Europe, Northern Europe, Southern Europe.

Price increases, political uncertainty and energy costs are having an adverse effect on the sales dynamics of the market for industrial doors in Europe. In the latest study by Interconnection Consulting, the sales forecast for the next few years has been significantly reduced. An average increase in volume of only 1.7% per year is expected until 2026.

Catch-Up Rate Slows Down

The market for industrial doors in the seven countries surveyed in Europe (see below) experienced a partial recovery as early as 2021 after the pandemic-related crash in 2020. However, after the market still grew by 3.5% in 2021, sales only increased by 1.2% in 2022. High energy costs and sharp price increases noticeably slowed sales momentum. Turnover was naturally able to grow more strongly in 2022 (+10.8%) due to inflationary conditions. Turnover will also increase by an average of 5% in the coming years. The largest increase in turnover is expected in France, with a rise of 6.9%. The dominant region for industrial doors is along the Rhine, in North Rhine-Westphalia, where there is a large sales market due to the high industrial density. Overall, Germany and France account for almost 70% of the total market volume. In comparison, Italy only has a share of 13.9%. The most important players in the European market are: Assa Abloy Group, Breda, Condoor, Novoferm, Ryterna, Teckentrup, Wisniowski.

Sectional Doors Dominate

Sectional doors are the largest product segment with almost 250,000 units sold, accounting for 54% of the market, followed by roller doors with 23.9%. In all countries except France, the market share of sectional doors is over 50%. In France, however, the share of roller doors is significantly higher than in the other countries surveyed. Steel is the most important material with a market share of more than three quarters and an above-average growth potential of 2.1% per year until 2026, followed by aluminium, which lost market share to steel last year due to high price increases. Other materials, such as PVC or mixed alloys, have a total market share of around 5%. The market share in value of the top 10 companies in the countries studied is 73.3%.

The study examined the countries: France, Germany, Italy, Austria, Switzerland, Poland, Sweden

Corona has given a further boost to online sales. However, Interconnection Consulting’s annual online mystery shopping test of the Austrian prefabricated house market shows that the potential of inquiries from the Internet is still far from being exploited.

Little Time Spent on E-Mail Enquiries

Although the 62 Austrian prefabricated house manufacturers contacted now answer the enquiries quickly, the quality of the responses has declined compared to last year. While last year 73% of the manufacturers responded to all four questions posed, this year only 66.7% took the time to answer all questions. Some positive companies that showed competence in answering all questions were Elk Fertighaus and Haas Fertigbau.

Hardly Any Follow up

Not only is there room for improvement in the quality of responses to e-mail inquiries, but there is also a need to get better in terms of follow-up. “The potential for lead generation is rarely exploited,” concludes Panorea Kaskani, the author of the study. Despite the customers’ expressed interest, only about one eighth (13%) of the companies dare to make a further contact attempt, after the first e-mail contact. “Especially when it comes to closing the deal, far too few manufacturers are still making a real effort,” explains Kaskani. Only 25% of manufacturers who sent information by post or electronically were interested afterwards whether there was further interest in cooperation. Companies that took advantage of the e-commerce potential of e-mail enquiries and acted with a high sales orientation were Griffner and Baufritz, among others. Zenker Haus and Malli Haus also shone with above-average sales orientation.

The Golden Rule is Increasingly Ignored

While the companies are taking less time to answer the questions, the response of the manufacturers to the enquiry has improved slightly compared to last year. This year, 72.6% of the manufacturers contacted responded to the first mail, compared with only 64.3% last year. However, the response within the first 24 hours has decreased slightly. The golden internet rule of a response within 24 hours was fulfilled by only 51.9%, compared to 54.0% in 2021. The average response time to an e-mail enquiry was 2.4 days this year and thus remained constant.

If you want to increase prices and ask yourself how high a price increase can be without losing customers, or which feature you could perhaps do without for cost reasons in order to keep prices stable, you will soon realize that this is an extremely risky bet without empirical data. In the following, we present a tool that predicts the behaviour of your customers when prices change or when the offer changes. Along the way, you’ll also get information about your brand value.

Price is the most important profit factor for a company. If it is possible to increase prices by a few percent without losing sales, many companies can double their profits. However, this is only possible if the killer application is known, i.e. those product features for which the customer is willing to pay more money. More and more often, these killer applications are not in a technical achievement, but in a special feature of the service (fast delivery, warranty periods) or in an emphasis of an existing feature: Although all windows are “custom-made”, this feature is not communicated by the window industry. However, customers are willing to pay more for custom-made windows. The situation is similar when safety, convenience or sustainability are highlighted, provided of course that this corresponds to the facts

A market simulation also clearly shows whether there are price thresholds, i.e. a price which, if exceeded, leads to a massive drop in sales. However, price increases up to just below the price threshold cost almost no sales. If you know the price thresholds, you can either increase prices without losing sales (a previously wasted profit) or you know the maximum price for a large target group.

In addition to price and product features, the brand plays a central role in the purchase decision. In this context, the market simulation answers a whole series of central questions on the topic of brand: First, it can be determined what share of the overall decision the brand plays at all. There are markets where 60 – 70% of the decision is based on the brand (and thus not on price or product features) and there are markets where brands play virtually no role. Much more important, however, is the question of what value one’s own brand has in comparison to the competition. The market simulation can express in Euros per product whether there is a positive, neutral or even negative brand value. In our experience, there are often astonishing surprises in this area in particular.

The basis of the market simulation is in no case a questioning of consumers about their wishes à la: “What is the maximum you would pay for this brand? This would only result in meaningless wishful answers. Valid market simulations are based on a realistic simulation of purchase decisions by means of a software-based Choice-Based-Conjoint-Analysis, which simulates consumer decisions and very realistically simulates the change of decisions and brand shares. For more details, please refer to “The road to market simulation”

The road to market simulation

The CBC (Choice-Based-Conjoint) in practise

What actually happens if you increase prices by 5%? And what would be the effect of shortening the delivery time to 7 days or extending the warranty to 2 years? What would have been unanswerable years ago can now be done at the push of a button. The market simulation not only shows how market shares are reshaped by price or product changes, it even shows which competitors you lose and from whom you gain market shares. We will show you how this works here:

When customers (whether B2B or B2C) make a purchase decision, this is co-determined by a bundle of characteristics: If you’re an Apple fan, you’ll buy this brand and see if the price still fits into your budget. Someone who is not interested in brands will, for example, look at the price of a computer monitor in relation to the most important product features.

In each case, a choice is usually made from different offers or a purchase is not made. This is exactly what market simulation models based on choice-based conjoint are based on.

In a first step, those features must be defined with the client who significantly influences a purchase decision. Of these, price and brand are almost always predefined. Since a maximum of 6 – 8 features must be queried, it can make sense, especially with technical products, to have a focus group beforehand so that one does not forget an essential purchase criterion, which is often not technical at all, such as “fast delivery” or “user-defined colour”.

Once the decisive product features and their various characteristics (e.g., screen diagonal) have been defined, the field phase can begin: Product feature – screen diagonal; characteristics: 42 inches, 49, inches, 55 inches, etc. the competitors to be included in the analysis defined, the field phase can begin. Using an online survey, the purchase decision process is recreated as realistically as possible by requiring respondents to make several product comparisons. In practice, several different product bundles are suggested to the respondents, which differ from each other in terms of brand, price, and other defined product features. The respondent thus has to weigh the different product features relative to each other and ultimately decide which option to select.

If all the product comparisons have been carried out successfully, it is then possible to calculate how important the brand, the price and all the other product features taken into account are for the purchase decision process.  The software behind the survey enables the statistical calculation of so-called part worth values for the individual product features. In this way, it can ultimately be validly determined which features are particularly important for the product evaluation or decision, as well as the degree to which each feature is preferred from the customer’s point of view.

However, this superior methodology not only makes it possible to analyse the relevance of individual product features in the decision-making process, but also to simulate the impact of product and price variations on the achievable market share. Based on the part worth values determined, the “share of choice” in the sample can be calculated – in other words, what percentage of respondents would opt for a particular product-price variation. All the results of the CBC analysis can thus be combined in a simulation tool that shows, on the one hand, which market conditions – in terms of the “Share of Choice” – prevail in the market for certain offers and, on the other hand, how these market conditions change with price or product variations. In other words, the software allows you to simulate the extent to which you can increase your market share by lowering your prices or improving your product, and from which of your competitors you steal market share in the process.

If you have further interest in a CBC, please feel free to contact us here

The pandemic also caused a slump in the global market for blow moulding and blow moulding machines. The decline in sales in 2020 was over 7%. However, 2021 will see an increase of 3.9% for the global market, as a study by Interconnection Consulting shows.

China Is The Growth Engine

Blow moulding can be used to produce hollow plastic components. Important products include plastic bottles, plastic canisters, washing water containers, fuel tanks, etc. The global market for blow moulding & machinery is led by the China & Taiwan region, which accounts for about one fifth of total sales. China will continue to determine the dynamics of the global market in the coming years. The annual growth rate will be 8.6% in value until 2024, as this study shows. With the new 5-year plan, China will invest heavily in the construction of new hospitals and the expansion of medical care. At the same time, further urbanisation will be tackled, which will also benefit the blow moulding industry in many areas. Besides China, India is an important growth market for the industry. The market for blow moulding machines will increase by 4.2% this year, although the sales level of 2019 will not be reached again until 2022 at the earliest. The beverage sector in particular, with a share of around 48%, dominates the market in India. In terms of total sales, the USA & Canada region is the strongest in the world. But even there, the dynamic growth of the industry was abruptly halted by the pandemic. In the long term, however, the market for blow moulding machines will grow by 5.6% annually until 2024. The fastest-growing markets in the USA & Canada are the cosmetics sector, with  an annual growth of 8.2%, pharmaceuticals and food. In terms of machine types, stretch blow moulding machines (linear and rotary) dominate the market worldwide with 50.8%. This is followed by injection blow moulding machines with 21% of the total market and extrusion blow moulding machines with 18.2%. The blow moulding segment reached a market volume of €535.7 million in 2019. Here again, the China & Taiwan region leads with a 19.2% share of sales, followed by India (14.7%) and the USA & Canada region (13.5%). The strongest dynamics in this area can be seen in the Indian and African markets.

Tougher Competition for Market Leaders

The top ten companies worldwide hold about half of the total market (49.2%). Extrusion blow moulding machines were less affected by the crisis. Accordingly, manufacturers in this segment were also able to gain market share, such as Kautex. The Japanese injection stretch blow-moulding machine manufacturer Nissei was also able to strongly expand its market shares. The undisputed market leader, however, remains Krones. Other important manufacturers are SIPA or KHS Corpoplast.

Sustainability Is The Industry’s Key Topic

A major issue for the blow moulding industry is the global trend towards banning the use of single-use plastic materials and the focus on sustainability and recyclable plastic materials. Meanwhile, the trend against the production of single-use bottles and disposable products has reached almost all parts of the world. China bans single-use plastic in some provinces. In the USA, 95 state laws on plastic have been passed. In the EU, at least 25% of PET plastic bottles are to be be made of recycled plastic by 2025. By 2030, this mandatory target is to be raised to 30%. Nevertheless, the market for blow-moulded plastic will continue to grow, especially in the beverage market. “A steadily growing population in India, Africa and China, and the increasing middle class in these regions of the world are responsible for this increase,” explains Daniel Kollar, the author of the study.

The European blow moulding market lost 7.8% of its value last year due to the pandemic. A slight recovery is now forecast for 2021, with an increase of 3.2% compared to 2020, according to a study by Interconnection Consulting.

Blow moulding can be used to produce hollow plastic components. Important products are for example plastic bottles, plastic canisters, washing water containers, fuel tanks, etc. Even before the crisis, the European market had the weakest growth dynamics compared to all other regions worldwide. To make matters worse, the regions of Western and Southern Europe in particular were more severely affected by the pandemic than many other regions in the world and recorded a decline of 11.9% and 9.2% respectively. Consequently, the greatest momentum in the future will not come from these regions, but from the CEE region and Eastern Europe. In the CEE countries, the annual increase forecast until 2024 is 5.3%, with the study also predicting similar dynamics in Eastern Europe. For Western and Southern European countries, it will take at least until 2023 before the market level of 2019 is reached again. In terms of machine types, stretch blow moulding machines (linear and rotary) dominate the market across Europe with 60.9%. This is followed by extrusion blow moulding machines with around a quarter (22.5%) of the total market, and injection blow moulding machines with a share of around one-sixth of the total market. Extrusion blow moulding machines in particular were able to gain market share in 2020, as they lost less than other product segments with a decline in sales of 6.2%.

Tougher Competition For Market Leaders

Accordingly, producers in the extrusion blow-moulding machine segment also gained market share, such as BBM. The Japanese injection stretch blow-moulding machine manufacturer Nissei was also able to strongly expand its market share in Europe. The undisputed market leader, however, remains Krones. The top ten companies in Europe hold more than half of the total market (57.9%).

Sustainability Is An Opportunity For Europe

A major issue for the blow-moulding industry is the global trend towards banning the use of single-use plastic materials and the focus on sustainability and recyclable plastic materials. Especially the highly developed industrialised countries in Europe – favoured by strict laws and regulations – are leading the way. In the EU, at least 25% of PET plastic bottles are to be made of recycled plastic by 2025. By 2030, this mandatory target is to be increased to 30%. “Big brands are being forced to minimise the use of non-recyclable single-use plastic materials,” explains Daniel Kollar, the author of the study. Increasingly strict laws are also leading to bioplastic packaging gaining more and more ground. However, due to the diversity in the material, new blow moulds as well as blow moulding machines are needed for processing, Kollar explains. “The trend is driving the development of the technology and the market.“

Regions analyzed:

Northwestern Europe (UK, Ireland, Norway, Sweden, Finland, Denmark, Iceland)

Western Europe (France, Belgium, the Netherlands, Luxembourg)

Central Europe (Germany, Austria, Switzerland)

Eastern Europe (Poland, Hungary, the Czech Republic, Slovenia, Slovakia, the Baltics, Bulgaria, Russia, the Ukraine, CIS)

Southern Europe (Spain, Portugal, Greece, Italy)

On account of the positive economic trends in Europe and China, global sales in the hot runner systems market grew by 8.2% in 2017. However, the intensifying trade war between China and the USA, as well as the EU, is dampening prospects. According to a study by Interconnection, average annual growth through 2021 is expected to be only 5.7%. Overall, the global market volume was EUR 2.4 billion.

Quality Standards on the Rise in China

In spite of the strong growth, the times of double-digit growth rates in the hot runner systems market seem to be a thing of the past. Markets such as Central Europe and the USA have matured to a point that impedes high-level growth. China was once again the clear driving force in the market, with an 11.8% growth rate and a market volume of EUR 735 million. With a 30.7% share of global sales, China thus remains the largest market for hot runner systems – and its dominance is only expected to increase. The Chinese market is benefiting from both lower production costs and rising quality standards. The growth in China is being fueled to a large extent by the auto industry, though it is not just a matter of production. China is also witnessing a rising demand for cars due to an increase in disposable income. So it is not surprising that rising production costs are forcing production to drift more and more to India from China.

Protectionism Helping the US Auto Industry

The North American market grew 6.2% in 2017, a slight increase over the previous year. The market volume was EUR 432.6 million. Nonetheless, the slowing economic trends are showing all the signs of a saturated market. Even if the current economic conditions are sound, forecasts have been downgraded on account of Trump’s protectionist policies. And yet the US auto industry is actually expected to benefit from Trump’s protectionism and will remain the driving force behind the hot runner sector. Interconnection forecasts a 4.8% average annual growth in the sector through 2021.

Eastern Europe Compensates for Brexit

In Europe, the market volume in 2017 was EUR 639.1 million following an uptick in growth to 6.3%. The economic boom in Eastern, Central, and Southern Europe was thereby able to more than make up for the weak developments in Great Britain, which has been stagnating on account of Brexit. Eastern Europe’s growth in 2017 was 8.1% and will continue to stimulate European growth. Average annual growth through 2021 is expected to be 5.9%. In Europe as well, the market for hot runner systems is also being fueled by the auto industry. The higher production volume in Eastern and Southern Europe, along with the increasing number of new car models, is responsible for the upsurge in the industry.

The global market for the use of polyethylene terephthalate (PET) machines and molds will increase by 7.2% in 2018. According to a new study by Interconnection Consulting, this significant growth is expected to continue in the years come, with average annual growth through 2021 estimated at 7.0%.

Beverage Market Enlivening the PET Market

The largest force in the PET market is the food and beverage industry, which continues to replace more and more glass and other materials with PET bottles. With a market value of EUR 1.5 billion and a 7.5% growth rate, beverage packaging represents the largest share of the PET industry. By 2021, the beverage industry’s market share is expected to climb from 54.9% to 57.2%. Though it has a relatively small market share of 9.7%, cosmetics is currently considered the dynamo of the market, with a 7.7% projected annual growth rate through 2021.

Asia the Global Driving Force

The highest growth rates can be found in the emerging markets of China (+9.4%), India (+10.0%), and Southeast Asia (+9.6%). China is the largest market in Asia, and on account of above-average growth in the future, its current global share of 16.7% will to continue to expand and is expected to hit 17.3% by 2021. Chinese growth is largely driven by the heavy migration to the cities. Increased spending on food has led to strong growth in the food and beverage industry, which, with a share of 74.6%, also constitutes the most important segment of the Chinese market.

New Lifestyle Boosts PET Industry

America is the second-largest market for PET machines and molds, with a growth of 6.1% last year. This upward trend is set to continue, reaching a CAGR of 6.4% between 2018 and 2021. New lifestyles and critical consumers are largely behind the sharp rise in the highly diversifying market for PET blow molds especially in the USA and Canada. Europe’s market posted comparatively moderate growth rates of 2.2% at a market volume of EUR 586.7 million. No individual national market in Europe can keep pace with the rate of global growth, even though growth rates are expected to cool back down somewhat in the upcoming years (CAGR of 3.8%).

Tight Competition

The largest producers in the PET mold market hail from Germany, Italy, Japan, France, China, and the USA. The stretch blow molding machine market is dominated by Germany and France. The linear stretch blow molding market is dominated by the Japanese company Nissei ASB.

Der globale Markt für Glasmaschinen betrug 2017 rund 3,1 Mrd. Euro und wird bis 2020 auf 3,5 Mrd. Euro anwachsen. Insgesamt stieg der Markt im vergangenen Jahr weltweit um 2,0%. Aufgrund der niedrigen Arbeitskosten sind vor allem Osteuropa, Indien, Asien und Lateinamerika die Märkte mit dem größten Wachstum.

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The world market for loader cranes is expected to decline by 9.4% this year. However, a new study by Interconnection Consulting expects a fast recovery of the industry. The market volume is expected to return to pre-crisis levels in 2023.

The market for loader cranes is very dependent on the GDP in the individual countries as well as on the construction industry. The picture is heterogeneous in the individual regions of the world. While the US and Europe have seen strong growth in residential construction in recent years, Japan and Australia have seen a negative development in this sector. Other countries, such as China or Brazil, have increased their output, especially in the non-residential construction sector. Overall, the construction projects worldwide caused the market for loader cranes to grow by an average of 2.3 annually between 2016 and 2019. The largest market for loader cranes is Europe with a share of 30.2%, ahead of the USA with 21.1% and China with 17.4%. Like many other regions, the European market is expected to shrink this year in the double-digit range, as are China (-11.3%), Australia and Japan. The US is doing slightly better, with an expected decline of less than seven percent.

Different Speeds

The post-crisis renaissance of the European market will take place in different regions at different speeds. Germany will recover fastest. By 2023, the market volume there will already have reached a significantly higher level than before the crisis. In France, however, the catching-up process will take longer. Between 2020 and 2023 the market there will decline by -3.1% per year on average.

Kuckle Booms Dominate

Kuckle booms are the dominant product group with a market share of 85.8%. The other two important product groups are recycling cranes with a market share of 7.6% and timber cranes. On top of their dominance, the kuckle boom cranes are also the product group with the highest growth rate. Kuckle boom cranes are set to grow by 2.8% per year in value until 2023. The boom for this segment can be seen all over the world. Th sales share of this product is above 80 percent in all regions of the world. Cranes with a height of 10-20 metres are the strongest segment with a sales volume of 36.5%. This height is even more dominant  in China than in most other regions of the world, where this segment accounts for almost three quarters of all cranes. By comparison, the share of this segment in Europe is only 22.8%, holding the third place. Here, cranes up to a height of 10 metres hold first place with around a third of sales.

The global market for profile machines for window and door production was €896.9 million in 2020, 0.7% lower than in 2019. This market experienced strong growth in the last few years before the pandemic and was not hit as hard as other sectors. The market will also catch up quickly once the crisis is over, as a new study by Interconnection Consulting shows. 

Europe Leads the Way out of the Crisis

The global market for profile machines for window and door production is linked to the sales situation and the development of the window market. In Europe, the CEE region has seen itself as a motor for the industry in recent years. The region is responsible for 30.1% of the global output of profile machines. The growth of the industry in this region was up to ten per cent in the years before Corona, also due to the demand for PVC machines from Germany. In 2019, the CEE region displayed a growth of around seven per cent. While the outlook for the European markets is good even after the crisis with good expected growth rates, the other side of the Atlantic is in for less rosy times. Growth in the NAFTA region as well as in Latin America will be less dynamic than in Europe. In Asia, China is the clear market leader with a share of over 70 per cent. The young market for profile machines in Asia is still dominated by local manufacturers. Growth rates in the Asia-Pacific region were 7.2% in 2019, the highest in the world. The market there benefits not only from cheaper production costs, but also from rising quality standards and network effects between window and profile manufacturers. Of the three machine types (PVC, aluminium, steel), PVC has the greatest growth potential for the future and the largest market share with over 60 percent. One driver for PVC profile machines is the Chinese window market, where PVC is the most popular window frame material.

New Global Players from China

The market for profile machines is highly concentrated. The top ten companies worldwide occupy more than 50 percent (56.9%) of the world market. The market is dominated by European companies and here again mainly by German companies like Urban, Rotox, Schirmer and Italian companies like Voilàp, FOM Group or Graf Synergy, the Italian PVC specialist. Apart from other big European players, there are only US companies and Turkish manufacturers that are involved in the world market. Also in China, after dominating their local market, some manufacturers are trying to jump into the global market like Zhongwang or Xingfa, which will make competition tougher worldwide in the future.