“One keeps talking about a rise of the construction sector, especially in infrastructure. Wouldn’t it be better to say that what is happening at present is where the construction sector should be and to rethink the size of construction companies and of construction equipment distributors?” Neagu asks.
He suggests opportunities should be sought outside the country, one should refocus on other sectors, such as forest areas, where routes need to be rebuilt, trees need to be replanted.
He adds that all market players should draw up business plans and think longer-term. They should make plans for 1-3 years, but without hoping massive investments will be launched during this time.
Bergerat Monnoyeur is the distributor in Romania of Caterpillar, one of the world’s largest manufacturers of construction equipment. Bergerat Monnoyeur recorded turnover of around EUR29 million last year in Romania, according to the Finance Ministry. For 2013 the head of the company says the turnover will be similar to last year’s, despite the market decline.
“Although the market declined, we expect a flat turnover because we recorded a sales rise for second-hand equipment, service and rental,” Neagu says.
The Romanian market of new construction equipment fell by around 20% this year. The market is set to be worth around EUR50 million at the end of the yea and sell 1,000 units, according to estimates of Bergerat Monnoyeur. This compares with a value of EUR250 million of the market during the 2007-2008 booming period.
The decline of the sector this year comes as the state has launched increasingly few new projects, while private investors in turn have reduced the volume of projects. In addition, the implementation of programs for buying construction equipment using European subsidies has been delayed. Whereas in 2011-2012 European subsidy programs generated around 60% of the market, this year they account for around 30-40% of the sales.
On the other hand, the market of second-hand equipment has remained steady this year, at around EUR15 million.
Liviu Neagu expects the construction equipment market to see an around 20% rise in 2014 and basically return to the 2011-2012 level.
Bergerat Monnoyeur Romania and the Republic of Moldova has 132 employees.
The company, which is part of French group Monnoyeur, competes against firms such as Marcom, the exclusive distributor of the Komatsu brand, and Terra Romania, distributor of the JCB brand.
(English version by Daniela Stoican)