Ukraine: how builders cope with the shortage of materials caused by the war?

Arthur Pereira edited by Wassila Belhacine 06:47, May 08, 2022

141,900 building permits were issued for the first quarter of the year.

A record for 15 years.

However, the lack of materials and the lengthening of delivery times are worrying construction companies.

Building a house without tiles, bricks or windows can quickly become complicated.

However, this is the situation in which some manufacturers could find themselves if the current context continues.

Faced with the increase in the number of building permits, materials are struggling to arrive on time.

>> READ ALSO - 

Why the construction sector is doing (much) better in 2021

"My order book has doubled in one year".

At first glance, this is excellent news for David Lacroix, president of two construction companies in Ile-De-France.

However, for several months now, he has been facing delays in delivering materials.

Delivery times doubled

Indeed, part of its goods come from factories in southern Ukraine and in particular from that of Azovstal, which is currently under bombardment.

Impossible for transport trucks to get there.

Thus, delivery times are extended.

"It's at least two months longer than before the war. This mainly concerns bricks or tiles", explains David Lacroix.

Reduced margins

Rarer goods but also more expensive.

For example, the price of the tile has increased by 30%.

Additional costs that automatically reduce margins.

"On a house sold at 200,000 euros, the margin can decrease by 40% compared to the margin calculated at the time of signing", underlines the entrepreneur.  

>> Find Europe Matin in replay and podcast here

Nevertheless, David Lacroix had anticipated his losses.

In particular, it had indexed its sales contracts to the inflation of materials.

In addition, he had increased his delivery times.

However, if the conflict in Ukraine were to last, the sector could be harder hit.