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Germany’s construction industry has endured several years of contraction, weighed down by elevated financing costs, expensive building materials and subdued residential investment. The downturn has also affected the country’s aluminium industry, with estimated construction-related aluminium consumption declining by around 12 per cent between 2022 and 2025.
However, the outlook is beginning to change. With Germany’s construction industry projected to return to growth in 2026 and accelerate further in 2027, opportunities are emerging for aluminium suppliers across residential construction, transport infrastructure, energy networks and commercial developments. At the same time, efforts to strengthen closed-loop aluminium recycling in buildings could provide an additional avenue for growth.
The critical question is whether this anticipated construction recovery will translate into a sustained increase in aluminium consumption or whether weak residential demand and high operating costs will continue to constrain the market.
Germany's construction industry is expected to record modest growth of approximately 1 per cent in 2026, following a cumulative decline of around 10 per cent between 2022 and 2025. The forecast, however, represents a downward revision from earlier expectations.
The German Construction Industry Federation, Hauptverband der Deutschen Bauindustrie, initially projected growth of 2.5 per cent for 2026 before revising its estimate to 1 per cent amid weak activity and rising construction costs.
Managing Director Tim-Oliver Müller highlighted the continued pressure on residential construction, explaining that the industry's original forecast was no longer sustainable. Expectations for real residential construction growth were reduced from 2 per cent to just 0.5 per cent.
Nevertheless, the medium-term outlook is more encouraging. Construction industry growth is projected to reach approximately 2 per cent in 2027, supported by infrastructure spending, improving investment conditions and a gradual recovery in residential activity.
Between 2027 and 2030, the sector is expected to record average annual growth of approximately 3.5 per cent, with transport infrastructure, housing, data centres, renewable energy projects and power-grid expansion among the anticipated contributors, while lifting the possible consumption of aluminium for lightweight, durability, recycling advantages.
However, the relationship between construction growth and aluminium consumption is not necessarily proportional. The scale of aluminium demand recovery will depend on the types of projects receiving investment and the amount of aluminium used in each application.
Source: AlCircle