Overall, the trends forecasted for the construction and civil engineering markets in the period to year-end 2025 are relatively similar for the three Scandinavian countries. Common denominators include weak residential production figures and strong estimates for the civil engineering sector. Climate adaptation and transport are significant drivers of the infrastructure project pipeline, while continued robust macroeconomic trends, in terms of strong labour markets and population growth, would normally indicate high construction demand.
“In our view, several underlying drivers in the construction and civil engineering markets remain strong. If anticipated help in the form of lower inflation and interest rates materialises, we expect to see construction activity return to new growth in 2025 and into 2026. We expect to have an even clearer picture of whether markets are heading in the right direction by the autumn," says Veidekke Head of Analysis Kristoffer Eide Hoen.
The infrastructure market is expected to maintain its positive momentum throughout 2024. Growth estimates have been increased to 4%, from 3% in the previous forecast. The trend is expected to flatten out in 2025, albeit at a record-high level of activity.
As expected, construction markets are showing a negative trend, in line with the main forecast in Veidekke’s September 2023 market update. Despite a -8% decline, production in 2023 was still somewhat stronger than the -13% drop forecast last autumn. The estimate for 2024 has been adjusted to -16%, from -13% in the previous report. Given the current situation, it appears that most of the production drop will occur in 2024, and that the decline in 2025 will be a more moderate -3%.
“The most positive development since the previous report is the stabilisation of cost inflation. Although commodity prices have not fallen, energy prices are returning to normal levels and construction-cost inflation is back at historically familiar levels. While customers are still paying uncomfortably high interest rates, more stable cost inflation is helping to alleviate the problem,” concludes Kristoffer Eide Hoen.
For more information, please contact:
Kristoffer Eide Hoen, Director of business development and analysis, Veidekke ASA, +47 976 75 434, Kristoffer.Eide.Hoen@veidekke.no.
Veidekke press photos
Subscribe to notices from Veidekke
Veidekke is one of Scandinavia's largest contractors. In addition to undertaking all types of building and civil engineering assignments, the group also maintains roads and produces asphalt and aggregates. Veidekke emphasises stakeholder involvement and local experience. Its annual turnover is approximately NOK 43 billion, and half of its 8,000 employees own shares in the company. Veidekke is listed on the Oslo Stock Exchange, and has posted a profit every year since its inception in 1936.
| Title | File type |
| Presentation market update spring 2024 |