Construction Industry Trends France - 2021

マーケットモニター

  • フランス
  • 建設

2021/10/12

Structural deficiencies cloud the outlook of French construction industry

 

France construction credit risk industry trends | Atradius
IT France construct output

After contracting 14% in 2020, French construction output is forecast to rebound by about 13% in 2021, and to grow 3% in 2022. Residential building and civil engineering are driving the recovery. The renovation work segment remains resilient, while the Next Generation EU fund will provide large investments in projects with a sustainability aspect. However, commercial construction activity remains hampered by subdued investment in retail and office buildings. 

Over the past couple of years, French construction has faced structural problems, such as cash issues for businesses due to difficulties in funding their working capital requirements. Profit margins are expected to decrease further in the coming months, due to sharply increased construction material prices and rising labour costs. Many contracts do not contain escalation clauses, and the credit risk situation of companies with tight margins is about to deteriorate, which are mainly affected by material shortages, volatile input pricing and postponement of projects. It does not help that banks are generally reluctant to support the short-term financing needs of construction businesses.

Payments in the construction industry take 64 days on average, compared to 44 days on average for all other industries. Public bodies and larger construction companies in particular tend to extend payment terms. Payment behaviour has been rather bad over the past two years. Thanks to government support measures, construction insolvencies remained low in 2020 and in H1 of 2021, but an increase of up to 10% is expected in the coming months. 

While the current sector performance could be assessed as “Fair” due to robust demand and ongoing stimulus measures, structural sector fundamentals (tight margins, working capital issues, default frequency) remain “Poor”. Pandemic-related downside risks remain, and despite the strong growth forecast, French construction will not reach its pre-pandemic levels until early 2023.

関連ドキュメント

免責条項

本ウェブサイトの記載事項は、一般的な情報提供のみを目的とし、何らの目的においてもこれに依拠すべきではありません。規定条件については、実際の保険契約または該当の製品・サービス契約をご覧ください。本ウェブサイトの記載事項は、買主についてのまたは利用者の代理人としてのデューデリジェンスの実施義務を含め、アトラディウス側に何らの権利、義務または責任を生じさせるものではありません。アトラディウスが買主についてデューデリジェンスを実施する場合は、当社の保険引受をその目的とし、被保険者その他の利益を目的とするものではありません。さらに、アトラディウスおよびその関連会社、系列会社、子会社は、本ウェブサイトの掲載情報の利用によって生じた直接的、間接的、特異的、付随的、結果的損害について一切の責任を負いません。