Europe and the Middle East
Residential construction and modernization were drivers of demand in the EMEA region
In Europe, the Middle East and Africa (EMEA), the business environment continued to be favorable. KONE was successful despite the tough competition.
In Europe, the residential market was the main driver of Europe’s new equipment business. Although commercial construction still progressed at a fairly lively rate in the U.K., it was residential construction that was the dominating factor in most European countries. In the Southern European market, demand slowed down towards the end of the year.
The Middle East market continued to be buoyant due to energetic construction growth in most segments. The tourism industry is fuelling growth in demand for hotel and entertainment building projects, while infrastructure is being improved through projects such as airport extensions and the construction of a light train system in Dubai. As in Dubai’s case, Qatar, Saudi Arabia and Abu Dhabi were also enjoying strong construction activity in most segments in 2006.
Increased focus on design options
To better fulfill customer needs, KONE introduced a new product concept in Europe. The key idea is to provide customers with a wider range of alternatives in choosing their elevator car interiors and performance features. The preferred offerings consist of a broad set of harmonized packages of different options.
By predefining the product packages, KONE aims to provide the customer with greater flexibility and a shorter response time. The preferred packages have been applied to the new release of the machine-room-less elevator, KONE MonoSpace®.
Improved customization is also offered by the KONE Deco™ solution, which makes it possible to decorate elevator car interiors with different patterns. As part of this solution, the designs of the Finnish design company, Marimekko, were added to the decoration portfolio in 2006.
Russia also exhibited healthy market growth. while construction activity continued to accelerate in all construction segments, it was the retail market that was the main driver of demand.
There was harsh price competition in the market for new elevators and escalators in all market areas. In addition, increasing escalator imports from China continued to press down the market prices of standard equipment in the EMEA region.
The maintenance market progressed well, although tough price competition continued. It is estimated that around two-thirds of the elevators in service in Europe are over 20 years old, which increases the need for both maintenance and modernization.
The European Safety Norms for Existing lifts (SNEl) continued to create a favorable environment for the modernization business. Modernization orders continued to increase particularly in countries that have adopted SNEl in their legislation. The rapidly growing modernization business is increasingly attracting the attention of both global and local players. For KONE, the modernization business was active especially in France, the U.K., Germany and the Nordic countries.
In 2006, KONE won several major contracts from the public transportation segment. The most significant orders concerned a modernization of the escalators and walkways in the Roman metro system, several major projects for the Madrid metro, an order for the Vienna International Airport and a service contract for the London Underground.
KONE also signed a contract to supply all elevators for the old London Stock Exchange Building and won a major order in the retail sector from Tesco PlC to supply ramps and elevators for stores across the U.K.
KONE also won a major contract to design, supply and install all the elevators on Celebrity Cruises’ three new cruise ships, and signed a contract with Aker Yards for the design, supply and installation of all the elevators on a mega-cruise ship.
In the middle East, KONE products were delivered to the 300-meter-high Doha Sports City tower, which was the symbolic landmark of the 2006 Asian Games.