Due to the Ukraine war, the Main Association of the German Construction Industry can no longer rule out construction freezes for many projects. According to the association, it is uncertain whether there will be enough material for all construction sites in Germany. In addition to steel producers, who would have to reduce their production, large refineries had also announced that they would have to reduce their bitumen production. Bitumen is used, among other things, in road construction and for the production of roofing membranes.
According to the Main Association of the German Construction Industry, even screws and nails no longer arrive in Germany due to sanctions. "We should [...] ask ourselves which projects we have to discontinue and which we cannot do without," says Tim-Oliver Müller, Managing Director of the German construction industry. The major price increases, such as for steel, bitumen and aluminum, mean that material suppliers can no longer submit binding offers.
However, since companies cannot pass on price increases in current contracts to their customers, this leads to an economic risk and to the fact that they are left with the additional costs. The Federation of the German Construction Industry is therefore calling for a price escalation clause for contracts. However, this would mean that the client would have to bear the additional costs. If nothing changes in the current situation, short-term construction stops cannot be ruled out, according to the association.
Source: bauindustrie.de
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