Europe Polycarbonate Sheets Market - Growth, Trends, COVID-19 Impact, and Forecasts (2021 - 2026)

The Europe Polycarbonate Sheets Market was estimated at USD 514.17 million in 2020 and the market is projected to register a CAGR of over 3.5% in terms of revenue during the forecast period (2021-2026).

The market was negatively impacted due to COVID-19 in 2020. Owing to pandemic scenario, several countries in the region went into lockdown to curb the spreading of virus. This affected various end-user industries such as construction, automotive, electrical and electronics, and others, thereby negatively impacted the polycarbonate sheets market. For instance, in the United Kingdom, various automotive manufacturers, such as Aston Martin, Bentley, Nissan, JLR, Rolls-Royce, and Vauxhall, closed production in the wake of the COVID-19 pandemic. Around 78,767 vehicles were manufactured during the first half of 2020, registering a slump of about 42% in car production, the lowest production level in the country since 1954. Such sharp drop in the production of vehicles is expected to decrease the demand for the market studied. However, the condition is expected to recover in 2021, which is expected to drive the market studied during the forecast period.

• Over the short term, revival of the construction industry in the region and the increasing popularity of polycarbonate sheets against conventional materials, are expected to drive the growth of the market. For instance, the upswing in construction has been encouraged by the European Central Bank’s ultra-low interest rates, a growing urban population, and high immigration over the past five years in Germany. The German government made an announcement regarding its plan to construct around 1.5 million housing units by 2021. The overhang of pending residential building permits increased to more than 400,000, suggesting the growth of the sector.
• On the flip side, volatility in raw material prices and negative impact of COVID-19 pandemic are expected to restrain the market.
• Emerging applications in the medical sector, as an alternative to PPSU and PSU sheets and unique applications in automotive glazing and electrical and electronics are likely to act as opportunites in the future.
• Germany dominated the market across Europe, due to the rising demand in the construction industry.

Key Market Trends

Increasing Demand from Construction Industry

• Construction was the major end-user industry for the polycarbonate sheets market, accounting for around 64% in 2020. In the construction industry, polycarbonate sheets are used in roofing, cladding, and glazing applications, owing to their lightweight, easy installation, and energy conservation features. They are further used fences and walls in both residential and commercial building projects. ​
• Companies, such as SABIC Innovative Plastics, provides a double walled extruded polycarbonate sheet called Lexan Dripgard, which offers UV protection thermal insulation, high light transmission, impact strength, long-term weather ability, and lightweight, having resistance to condensate build-up and has wide utilization in the construction industry. ​
• Polycarbonate roofs are the current trend in building, walkways, and other roofing because of its UV protection feature. This is the result of UV stabilizers in polycarbonate to help protect the material from the sun and sustain it for a longer period of time.​
• Additionally, when compared to glass, a solid polycarbonate sheet has a far higher impact. This is extremely useful when it comes to the transportation, handling and installation phases of any project. Moreover, polycarbonate sheets provide higher resistivity against hail, falling branches, and other objects when compared to the resistivity of glass, acrylic or GRP/fiberglass. Also unlike GRP, polycarbonate does not become more brittle with age.​
• Polycarbonate sheets can also be laminated together with a polyurethane film adhesive under heat and pressure for more demanding applications, where resistance to forced entry is needed. It can also be laminated with glass layers on the outer skin to provide even better and chemical resistivity. Glass-clad polycarbonate laminates offer resistivity to high-powered ballistics.​
• Germany has been one of the worst hit countries in the world by the COVID-19 virus outbreak. In response to outbreak, the German Government has announced several containment measures including the closing down non-essential businesses in order to slow the spread of the virus across the country. However, the German government has exempted infrastructure, residential and utilities construction from the lockdown measures with construction allowed to continue through the Covid-19 crisis.​
• In Europe, Germany is the leading construction market and home to the continent’s largest building stock. The construction sector is booming in Germany. High demand for residential buildings in the country is driven by the growing population, demographic changes, and a favorable economic environment. Demand in the residential sector can be majorly found in multigenerational houses, micro-apartments, and prefabricated buildings. ​

• According to the Federal Office for Building and Regional Planning, Germany requires about 350,000 new housing units per year by 2021. In 2018, the German The buildings permits awarded stood at 24,318 in February 2020, a slight decrease when compared to December 2019 which was 41,046 units, and this has negatively affected the construction market. This trend is expected to slightly change, owing to the rising demand for real estate, increasing population, increased job security, and low borrowing costs.​

• In United Kingdom, the construction sector contributes to around 6% of the country’s GDP. To provide better infrastructure to the population across the country, the government has planned to invest 1-2% of its GDP in infrastructure between 2020 and 2050 as part of the National Productivity Investment Fund (NPIF). ​
• Under NPIF, the government is planning to invest GBP 23 billion on housing, science and innovation, transport, and a 5G network over the next five years, of which, around GBP 7.2 billion is allocated for the construction of new homes and GBP 4 billion is allocated to infrastructure such as roads bridges, pavements and others.
• In Spain, the demand for new housing units are rising supported by better employment conditions. Spain’s National Statistics Institute (INE) estimates that the net household creation in the period 2019-2025 will be an average of 135,000 units on a yearly basis.​
• The government of Italy is pushing hard to battle the COVID-19 outbreak as well as the falling economic scenario in the country. The country has announced an emergency financial aid worth nearly USD 28 billion for supporting the economy by supporting certain segments in the industry.​
• Such positive factors are expected to drive the consumption of polycarbonate sheets in the construction industry through 2026. ​

Germany to Dominate the Market

• The German economy is the largest in Europe and the fifth-largest in the world. In 2019, the German economy grew by about 0.5%, which was its weakest growth rate in the last six years. ​According to IMF, in 2020, the country further recorded a decline in GDP growth of about -6% due to the COVID-19 outbreak, and pick up to 4.2% in 2021, subject to the post-pandemic global economic recovery.
• Germany has been one of the worst hit countries in the world by the COVID-19 virus outbreak. In response to outbreak, the German government had observed several containment measures including the closing down non-essential businesses in order to slow the spread of the virus across the country.
• However, the German government had exempted infrastructure, residential and utilities construction from the lockdown measures with construction allowed to continue through the COVID-19 crisis.
• The construction sector’s revenue in the country has grown by 5.1%, reaching EUR 128 billion in 2019. According to the industry experts, the number of completely constructed new houses is estimated to around 315,000 in 2019, which is higher, as compared to the total number of completed constructions in 2018, which was 300,000. This positive momentum has taken a huge blow from the devastating pandemic situation in 2020. According to Germany's construction industry association (HDB), the domestic construction industry fell by 3% in terms of revenue, in 2020. However, this situation is expected to be neutralized over the forecast period.​
• The increasing migration to the country has been stimulating the current demand for new residential construction. ​About 3.6 million migrants were expected to arrive to Germany, by the end of 2020-2021, which will require at least 350,000 new dwellings per year.
• The German Electrical and Electronic Manufacturers' Association (ZVEI) announced that in 2019 the German electronics industry recorded about 3.2% decline in new orders. While domestic orders indicated decline of 4.6% in 2019, foreign orders increased by 3.8%, driving electronic production in the country. ​

• In the beginning of 2020, the market expectations seemed improving, as 21% of the electronic companies anticipated an increase in the demand in the next six months. However, COVID-19 outbreak presented very challenging market arena for electronics industry.​

• The Automotive production of Germany in 2019 has seen a decline of -9% compared to that of 2018 that is the production in 2019 was 4,661,328 units, and in 2020 the car manufacturing industry is emerging from a scathing period of lockdown, production halts and a slump in sales. ​In the first nine months of 2020, Germany produced 2.55 million cars and light commercial vehicles which declined by 32.6% compared to 3.79 million vehicles during the same period in 2019. The outbreak of virus has affected the production, but the growing sales in the country is expected to drive the market studied during the forecast period.
• The German aerospace industry includes more than 2,300 firms, which are located across the country, with northern Germany recording the highest concentration of firms. The country hosts many production bases for aircraft interior components, and materials, largely in Bavaria, Bremen, Baden-Württemberg, and Mecklenburg-Vorpommern. Over 30 to 35 thousand new aircraft have been estimated to be operational by the next 20 years to meet the rising aviation demand. Thus, the increase in production of aircraft after COVID-19 recovery is expected to provide opportunities to the market studied during the forecast period.
• All the above-mentioned factors are expected to take toll on the growth prospects of the polycarbonate sheets industry over the forecast period.​

Competitive Landscape

The European polycarbonate sheets market is dominated by multiple players in the market with significant market share and is focused on research and innovation. The market becomes consolidated with the top five players accounting for around 65% of the market as various players contribute to the regional demand. Key players in the market include EXOLON GROUP GMBH, SABIC, Corplex, 3A Composites GmbH, and Brett Martin, amongst others.

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