In Germany, the number of sold window units declined by 10.2% in 2023. The main cause is a significant decrease in completed constructions in both residential and non-residential buildings (-16.9% and -8.6%, respectively). Overall, the decline in window sales in the new construction segment was 13.1%, and 7.7% in the renovation segment. The total window sales in 2023 decreased from approximately 15.4 million units to 13.8 million, as indicated by the regional study conducted by InterConnection, which analyzed window sales figures at the district level. The top 10 cities constitute about 17% of the window market in terms of quantity. When considering sales results across sectors, including new residential construction, new non-residential construction, renovation of residential buildings, and renovation of non-residential buildings, no federal state in Germany deviates from the general trend in the country. The combination of a decline in building permits, rising interest rates, high inflation, and declining real wages has led to a crash in building completions. Inflation and recession are hindering renovations.

Renovation of Non-Residential Buildings is Slightly less Affected.

Positive growth rates at the federal state level are observed only in specific segments: In the new residential construction segment, the federal states of Brandenburg (+7.3%) and Thuringia (+4.6%) are growth leaders. However, this increase suggests a delay in the implementation of construction projects rather than a dynamic development in the window market. In the renovation of residential buildings segment, only Berlin and Saarland show slight increases of 3.0% and 1.7%, respectively. In non-residential construction, the number of sold windows is influenced not only by the number of completed buildings but also by the size of the buildings. With a general decline in window sales in new non-residential construction by 8.6%, all federal states show very different results: from the sharpest decline in Schleswig-Holstein (-26.0%) to the strongest increase in Bremen (+11.0%) and North Rhine-Westphalia (+7.9%). The renovation of non-residential buildings proved to be more resilient in 2023, with a decrease of -4.1%, the lowest among all segments in the window market. The four federal states, namely Bavaria, North Rhine-Westphalia, Baden-Württemberg, and Lower Saxony, where 88% of the window market is concentrated in this segment, are relatively successful in the crisis year 2023. The overall decline in window sales in these states was 3.9%.

Top & Flop: Growth in Some Segments, Decline in All

The district of Peine achieved the highest growth rate with a 45.5% increase in sold windows. 2023 was a particularly successful year for Peine in new residential construction, with only a decrease in renovation of residential buildings observed. The district of Frankenthal in the Palatinate achieved a growth of 43.1% in 2023, leading the ranking ahead of Kronach (+42.4%). Frankenthal shows strong results in the new construction segment after an unsuccessful year in 2022. Kronach made it to the top three through successes in non-residential construction. Landau in the Palatinate rightfully occupies the first place among the losers (with a general decline of 41.4%) and experienced a decrease in sales in all four segments. The same can be said for Main-Spessart: the region loses in all segments, showing a decline of 37.8%, even higher than the entire Lower Franconia administrative district. Friesland concludes as one of the top 3 losers with a sales decline of 34.4%, significantly stronger than the Weser-Ems statistical region as a whole.

“Knowledge of regional growth rates is a crucial success factor for effectively addressing the German market,” says Julia Hrebenkova, the author of the study. Even in a market with a strong downward trend, there are growth islands and segments that resist the market development. Identifying these is a recipe for success.

30/01/2024

Copyright: Interconnection, Publication free of charge for coverage regarding the study and InterConnection Consulting.