Digest №1 - Russian HVAC/R & Water supply market
Once in 2 weeks we will release a digest for you with current useful materials: articles, market researches, news, webinars, video-conferences – as the industry is continuing its development!
Today in our digest: the volume of construction in Russia in 2020, import rates of heating appliances in 2019, the replacement of deteriorated engineering systems with new ones in Moscow in 2019 and targets for 2020, financing of HVAC systems construction and development in Russia in 2020, tips on dealing with Russian business partners and HVAC sales video trainings
We are absolutely sure that the industry should develop despite all odds. We will release a digest on heating, water supply, ventilation, air conditioning, refrigeration, swimming pools, saunas and spas once in 2 weeks to keep you up to date with market trends, current news, latest changes and innovations and help your professional development.
Our first digest is devoted to heating, water supply and pipes sector. You will learn the volume of housing construction in Russia in 2020, assess the volume of import of heating appliances in Russia from different countries and in different segments, analyze the level of replacement of old heating and water supply systems in Moscow with new ones in 2019 and such targets for 2020, find out the the level of financing of water supply and heating networks construction and development in some Russian regions in 2020.
Moreover, we offer you to watch the useful video on tips on establishing better connections with your Russian partners and find out HVAC sales secrets from free video trainings.
15.4 million square meters of housing were commissioned in Russia in the first quarter of 2020
15.4 million square meters of housing were commissioned in the Russian Federation by April 1st, 2020, which is 4.1% higher than in April 2019.
“The data of the first quarter of the year show growth, but we understand that due to restrictive measures aimed at reducing the spread of coronavirus infection that affected the construction industry, as well as stopping construction work in Russian regions with steadily high rates. Data of the next reporting period may not have positive dynamics. Our task in the short term is to restore the pre-crisis pace of construction and complete construction with commissioning in 2020,” commented Nikita Stasishin, deputy head of the Russian Ministry of Construction.
15.4 million square meters of commissioned housing include 7.4 million square meters of apartment buildings (which is 4.2% higher than the same period in 2019) and 8 million square meters of individual housing construction (which is 3.9% higher than last year).
Statistics on import of heating appliances to Russia within 2019 – summing up the results of the year
The volume of imports of heating appliances to Russia stabilized in 2019 and stopped a significant decline. The import volumes stabilized and even gave the effect of “correction” in the form of a little growth in some segments.
The physical volume of import of steel tubular heating radiators into the territory of the Russian Federation significantly increased by 28.1%. This trend indicates an increase in the share of this segment, belonging to the price categories “above average” and “premium”, in the structure of Russian consumption of heating appliances in general.
The significant increase by 66.1% in the physical volume of import of cast iron radiators into the territory of the Russian Federation was fixed in 2019. Such a large increase is most likely caused by the difficulties in manufacturing significant volumes of products by Russian and Belarusian manufacturers.
Convectors with a copper-aluminum heat exchanger showed an increase in imports by 3.3%. This situation is caused by a serious growth in the construction of commercial real estate and investments in this construction sector in 2019 (growth according to expert estimates from 25% to 40%), similar growth rates are forecasted in 2020.
Imports in the combined segment of aluminum and bimetal heating radiators increased by 8.1% in 2019.
“Aluminum” is using into new housing and the dynamics of its imports depends on the growth rate of construction. According to TASS data from Rosstat, the commissioning of new housing in Russia increased by 6% in 2019 compared to 2018, an increase amounted to 4.6 million square meters - from 75.7 million square meters up to 80.3 million square meters. In turn, “bimetal” is mainly used for replacing outdated water heating appliances and its sales depend on the “demographics of the park” of heating appliances and the number of repairs, including the scale of replacement within the regional programs for the overhaul of apartment buildings, the financing of which is growing faster than new construction (at least 15% per year).
The supply of aluminum and bimetallic heating radiators to Russia was mainly carried out from Chinese plants in 2019 (import growth from China by 7.6% vs 2018). European manufacturers have a significantly smaller share (there were deliveries from Italy, Ukraine and Spain in 2019). Supplies from Europe grew by 12.9%.
According to Association of Manufacturers of Heating Appliances, one of the factor caused stabilization of import is a steady increase in domestic demand, both in the framework of the installation of heating devices at new construction sites, and during their planned replacement during repair work.
8 tips on how to deal with Russian business partners
The HVAC & water supply market of Russia is one of the largest markets of this type in the world. It has a great potential: vast territories, huge population, climate conditions requiring various types of equipment depending on the season – from gas heating to solar panels, from electric boilers to energy-saving water heaters, from air-conditioners to refrigeration systems, from industrial pipes to plumbing equipment.
The HVAC & water supply market of Russia is extremely attractive for companies from all over the world and Aquatherm Moscow will definitely help you to get as much clients and partners in Russia as possible. When establishing contacts with the Russian partners you should take into account the Russian mentality.
We offer you to watch a short video from social scientist and business coach on cross-cultural communication, Tatiana Indina, to learn some useful tips which may help you to establish better connections with your Russian partners.
Solution to the problem of deterioration of engineering systems in Moscow – results of 2019 and plans for 2020
The deterioration rate of engineering networks in Moscow decreased by 3% in 2019. In 2020, it is planned to construct more than 1,400 kilometers and reconstruct over 600 kilometers of engineering networks. Their average deterioration rate should be reduced by 1.5%.
13 metro stations, 6 transport hubs, as well as over 70 socially significant objects - hospitals, educational and other institutions - will be connected to the heat supply system in 2020.
It is planned to build 150 kilometers and reconstruct 140 kilometers of heating networks, as well as reconstruct the equipment of the Biryulyovo-Borisovskaya and Perovskaya pumping stations in 2020.
Over 120 kilometers of the water supply system and about 65 kilometers of the sewer network were built and reconstructed in 2019.
In 2020, over 100 kilometers of water supply and 56.5 kilometers of sewer networks will be constructed and reconstructed. In addition, the “Rainbow” water intake unit will be modernized and its productivity will increase to 1 000 cubic meters per day.
Over 250 kilometers of cable communication collectors were built and reconstructed in 2019. Deterioration of collector networks was decreased by 8% (from 25% to 17%). In 2020, work will be carried out at 27 sites.
In 2019, more than 23 kilometers of drainage networks were updated, which is 67% more than had been planned. The decrease in their deterioration amounted to 0.8% (from 43.8% to 43%.) Another 14.5 kilometers of drainage networks will be built and reconstructed in 2020.
The level of financing of water supply and heating networks construction and development in Russia in 2020
Over 4 billion rubles are to be invested in heating systems and stations of the Altai Region in 2020.
T Plus will invest about 40 million rubles in the modernization of the heating networks in the center of Orenburg
The Republic of Dagestan will invest more than 4.1 billion rubles in the design and construction of water supply and sanitation facilities.
Let’s watch together!
As we all know, it is not enough to have a perfect product or service to become the leader of sales on the HVAC/R & Water supply market. A perfect product or service requires a perfect presentation to your customers.
You should know reasons why people buy such products, how to overcome objections and always be in touch with your potential or existing customers.
Let’s watch a series of HVAC sales trainings on the Success4others YouTube channel which may help you realize powerful HVAC sales for your company.
We are already in an active process of Aquatherm Moscow 2021 preparation and look forward to meeting and connecting you with the Russian buyers at our 25th international exhibition on February 2-5!