While the European construction industry has gone through a period of recovery, there is no room for complacency. Many challenges still persist, such as squeezed margins, economic uncertainty and ever-increasing demands for better environmental performance and productivity. In the UK, margins amongst the top ten biggest contractors fell to 0.38 per cent on a combined turnover of £31 billion (€27.4 billion), as of July 2018.
Darker clouds are also looming over western European construction. Across the EU, together with Norway, Switzerland and Turkey, the industry reached a peak revenue of €1,615 billion and employed over 17 million people in 2017. German-based rating agency Scope has warned of slowing economic growth and persistent labour shortages. The agency has revised its annual growth forecast for 2019 and 2020 to two per cent, down from a 2.5 per cent forecast in December 2017. Scope also points out the credit outlook, particularly for smaller companies, is in danger of deteriorating as the business cycle slows. These figures give a clear indication of the rising pressure main contractors are under to cut costs and improve productivity - and their suppliers should be attuned to these pressures.
This is why getting the most out of their equipment ranks so highly on the to-do lists of construction and equipment hire firms across Europe. In a major survey commissioned by Shell Lubricants, nearly eight out of 10 (76 per cent) of 400 construction staff said extending the lifespan of existing equipment was a priority.