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Follow on Google News | Road Construction Is Turning The CornerThe implementation of the road construction scheme in Poland is entering the final phase. The number of calls for tenders announced and those where winners have already been selected is growing; commencing from 2010, the length of road sections under
By: PMR Publications Strong market competition among contractors leading to price wars at the tender phase may have a serious adverse effect on the road construction market in the coming years. In the opinion of PMR analysts, massive accumulation of road projects expected to take place in Poland in 2010-2012 can lead to increased prices of construction materials and higher transport costs for these materials; additionally, it can also increase the costs of equipment and services in the construction industry. Furthermore, in addition to the construction of new roads, the scheme for redevelopment and rehabilitation of the existing national roads and roads managed by the local authorities will be continued – its implementation will involve participation of both contractors and suppliers of construction materials. As there are more projects in progress, construction costs can increase as well, which will necessitate margin reductions or contractors will be required to maintain the levels of margins at the expense of the quality of work. Moreover, in addition to the recovery in the road construction and in the civil engineering construction segment as a whole, the overall uptrend in construction prices will be also fuelled by the increase in the construction of buildings following suspension of this type of projects in 2009. In the opinion of the authors of the report, selecting the lowest-priced bids while disregarding the criterion of quality is bound to have an adverse impact on the road construction industry. Additionally, if contractors’ Since the number of procedures undertaken by the General Directorate for National Roads and Motorways (GDDKiA) with a view to selecting contractors using the restricted bidding procedure is growing, there are fewer protests filed by bidding contractors. The introduction of the design and build model of bidding procedure aims at reducing construction time. The authors of the report also note that while the design and build model is still relatively novel to the Polish road construction market, the Western countries have already started to depart from the system and opt for the Early Contractor Involvement (ECI) model where the contractor and the designer cooperate since the early design phase. In this way, considerable savings are achieved, both in terms of timelines for construction projects and lower costs. This system has been used in the UK since 2001; it is estimated that it reduces the time between starting design work and commencing construction work by up to 40%. This press release is based on information contained in the latest PMR report entitled “Road construction market in Poland 2009. Development forecasts for 2009-2012”. For more information on the report please contact: Marketing Department: tel. /48/ 12 618 90 00 e-mail: marketing@pmrcorporate.com PMR ul. Supniewskiego 9, 31-527 Krakow, Poland tel. /48/ 12 618 90 00, fax /48/ 12 618 90 08 www.pmrcorporate.com # # # About PMR PMR Publications (www.pmrpublications.com) End
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