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The Guardian
2 days ago
- Business
- The Guardian
Brick by brick: UK builders gear up for post-pandemic boom despite global gloom
Plasterboard should be in plentiful supply when Labour's building boom gets under way later this year, says John Sinfield. His new £170m factory near Bristol will dramatically cut the need for imports of the essential building product, he argues. Sinfield, the UK boss of plasterboard maker Etex, is not alone in the UK construction sector in taking a bet that the industry could soon prove a bright spot despite gloom over the impact of Donald Trump's tariffs on the global economy. 'You've got to invest ahead of the curve,' Sinfield says. Domestic brick factories are gearing up for a building bonanza that is expected to increase residential housing starts next year by more than 5%, according to the construction industry consultancy and data provider Glenigan. Shareholders in major housebuilders also appear to be picking up on the good vibes. On Tuesday, Bellway Homes, one of the UK's largest home builders, reported 'robust' spring trading and a strong outlook for the year ahead. It was enough to drive up builders' shares, putting those including Persimmon, Barratt Developments, Redrow and Taylor Wimpey at the top of the FTSE 100 risers' list. The arm of the construction industry that makes the walls, stairs and plumbing for every new home may not be as visible as the large housing developers, but will play a key part in the hoped-for building boom essential for the Labour government reaching its target of 1.5m new homes by the end of the parliament. Ministers see addressing the failure to build new homes quickly – by an industry tarnished by huge bonuses for executives – as a significant driver of economic growth. The housing minister, Angela Rayner, has spent the last few months locked in a battle with the chancellor, Rachel Reeves, over funding for her housebuilding plan in the run-up to Wednesday's spending review. There is deep scepticism about Labour's ability to reach the wished-for 300,000-a-year level of construction – up from 184,390 completions in 2024 – after a spate of negative figures that appeared to show a contraction within the industry in 2023 and 2024 was going to scar 2025 as well. Meanwhile, there are signs that economic uncertainty is affecting demand: house prices fell in May by 0.4%, dragging down the annual growth rate from to 2.5% from 3.2% in April, according to figures from Halifax. Construction firms are recovering from an inflationary rise during the pandemic that sent the cost of everything from timber to concrete blocks soaring. The price of building a home has since levelled off, but the cost of raw materials prices and skilled labour remains high. Surveys of the sector show a period of contraction that started in 2023 has continued this year, forcing many employers to lay off staff. An S&P Global survey of company purchasing managers in May showed the pace of layoffs was the worst since the post-banking crash period in 2010, excluding the pandemic. However, separate studies from industry bodies and Bellway's update contradict this gloomy message. They indicate a turnaround, and with the added twist of lessons learned from Covid. Namely, that a reliance on foreign suppliers can lead to shortages very quickly when the global shipping industry is upended. Unlike during the pandemic, homegrown manufacturing is protecting the housebuilding industry against Trump's see-sawing tariff war with domestic supplies available allaying concerns over products being held up at ports across the world. In fact, says Allan Wilen, chief economist at Glenigan, UK companies could benefit from importing cheap construction materials previously destined for the US, but redirected to avoid high import tariffs. 'It's possible that is one result of US tariffs,' he says. For Sinfield, the anticipated step up in demand should keep workers busy at his new 57,000 sq metre facility, located next to the Port of Bristol. Opened last year, the site will recycle about 35% of the material it uses from UK waste sources, further cutting the need for foreign supplies. Etex, the Belgian owner of the site, is selling boards that would previously have travelled from plants in Spain. Sinfield says the project pipeline is strong. 'The only question is how long it takes for contractors to go from the drawing board to being on site,' he says. Richard Burbidge, a family run business based in an eco-factory in north Wales, is also at the sharp end of the cyclical industry. The timber business makes stairs for new-build homes and is managed by Josh Burbidge, who is in the fifth generation to lead the 158-year-old enterprise. He says the firm responded to the energy price spike propelled by Russia's full-scale invasion of Ukraine in 2022 with a huge investment in solar panels, which cover the factory roof, and is just about coping with the extra costs from April's rise in national insurance and the higher minimum wage. Sign up to Business Today Get set for the working day – we'll point you to all the business news and analysis you need every morning after newsletter promotion At the moment their wood comes from the US, but his suppliers are ready to switch to Europe. In the longer term, he says: 'The actions of the US to place tariffs on traded goods will only encourage companies like ours to seek out and engage more reliable sources of product to place on the UK market.' Noble Francis, chief economist at the Construction Products Association, says brick deliveries are a useful proxy for housebuilding starts, where he anticipates a 5% expansion this year and 7% in 2026. Brick production was up by 31.4% in February, before slipping back to an 8% annual rise March, possibly because there is still a surplus of 459 million bricks in stock, according to the Department for Business and Trade. Francis is forecasting 2.1% growth in construction output volume this year, mostly skewed towards the second half of the year, and 4% growth in 2026. 'This year's private housing forecast is in line with the major housebuilders, which are broadly anticipating 3% to 8% growth a year over the next few years after a double-digit falls in activity between 2021-22 and 2023-24,' he says. Glenigan also offers a buoyant outlook, saying there are 'signs of renewed confidence', adding that housebuilding 'led the charge', with residential starts rising 24% in the three months to the end of April from the previous quarter. Private companies account for 87% of total housebuilding, so growth in 2025 will mainly be determined by demand in that sector, over social housing, he adds. As a sector, construction accounts for about 6% of national output, or gross domestic product (GDP), which is the equivalent of £170bn from an economy that generated £2.8tn in 2024. Labour has said it expects changes to planning laws, freeing up land for building, will generate an extra £6.8bn in activity by 2030. If larger housebuilders have one fear, it is the potential for shortages of skilled staff, especially in the midst of a clampdown on immigration. To prevent new border controls from derailing the building boom, the government said last month it will spend an extra £3bn to train 120,000 skilled workers, including builders, by 2030. Rayner is more concerned that private housebuilders will prove reluctant to complete large-scale projects to prevent over-supply denting house prices and profit margins. Yet even in that scenario it would take many months before supply would outstrip demand. In the meantime, the pillars underpinning growth appear to be in place, including a more secure domestic supply chain. The only question is how quickly it will gather pace.
Yahoo
18-02-2025
- Business
- Yahoo
Etex and Cognizant team up to boost innovation with AI and Automation
Renewed collaboration will see Cognizant provide support across IT services with the aim of reducing overall costs and significantly improving the user experience BRUSSELS, Feb. 18, 2025 /PRNewswire/ -- Cognizant (Nasdaq: CTSH) today announced the extension of its agreement with Etex, a global leader in sustainable building materials and lightweight construction. The five-year collaboration will involve implementing specific GenAI and chatbot solutions to enhance user experience and automate tasks, ensuring stable and optimized delivery. The use of AI and automation will help support a range of IT services including applications, workplace collaboration, network security, hosting and service delivery, and data with the aim of reducing costs across the business. "We are thrilled to continue working with Cognizant," said Dirk Altgassen, Chief Data & Information Officer (CDIO) at Etex. "By using their cutting-edge AI and automation solutions, we can tackle tough market conditions, cut costs, and improve our adaptability and efficiency. Cognizant's proven dedication and high standards make them a valuable partner for Etex as we continue to create safe, sustainable, and beautiful buildings for our customers." "We are delighted to continue our collaboration with Etex," said Geert Lejon, Country Head, Belgium & Luxembourg at Cognizant. "Our expertise in AI and automation will enable us to support Etex in overcoming cost pressures and navigating the dynamic market landscape. Our agile delivery model helps ensure we are positioned to scale up swiftly. Working with Etex has been a rewarding experience, and we look forward to achieving even greater success together." About CognizantCognizant (Nasdaq: CTSH) engineers modern businesses. We help our clients modernize technology, reimagine processes, and transform experiences so they can stay ahead in our fast-changing world. Together, we're improving everyday life. See how at or @cognizant. About EtexWe are an innovative and sustainable building materials company and a pioneer in lightweight construction. Our 13,500 teammates operate on more than 160 sites and at seven Innovation Technology Centres (ITC) in 45 countries globally. Etex is a global building material manufacturer and pioneer in lightweight construction. Etex wants to inspire people around the world to build living spaces that are ever more safe, sustainable, smart and beautiful. Founded in 1905, headquartered in Zaventem, Belgium, Etex is a family-owned company with more than 13,500 employees globally. It operates more than 160 sites in 45 countries and recorded a revenue of EUR 3.808 billion and a REBITDA of EUR 712 million in 2023. Etex fosters a collaborative and caring culture, a pioneering spirit and a passion to always do better for its customers. Etex has seven R&D centres supporting four global divisions: Building Performance: leader in plasterboards and fibre cement boards, and the global reference in fire protection solutions for the residential and commercial segments. Exteriors: provider of innovative, durable, high performance and beautiful fibre cement exterior materials for architectural, residential and agricultural projects. Industry: front runner of engineering expertise to drive the future of high-performance temperature insulation and fire protection in the industrial, aerospace and energy sectors. Insulation: leading European insulation provider of glass mineral wool and extruded polystyrene (XPS) to insulate residential and non-residential buildings. Etex's global portfolio includes leading commercial brands such as Cedral, Durlock, EQUITONE, Eternit, Gyplac, Kalsi, Pladur, Promat, Siniat, Superboard and URSA. Etex is Inspiring Ways of Living, for more information, please visit our website: For more information, contact: GlobalPR@ View original content to download multimedia: SOURCE Cognizant Technology Solutions Sign in to access your portfolio
