The construction machinery industry rises against the trend
At the Manzhouli Comprehensive Bonded Zone in Inner Mongolia, staff inspected the construction machinery and equipment that were preparing to be exported.
According to industry statistics from the China Construction Machinery Industry Association, from January to December 2021, a total of 342800 mining machinery products were sold by the 25 host manufacturing enterprises included in the statistics. Among them, the domestic market sales volume was 274400 units, a year-on-year decrease of 6.3%; The export sales volume was 68400 units, a year-on-year increase of 97.0%.
Although sales have been declining year-on-year for several consecutive months, the total sales of excavators in 2021 still achieved a slight increase compared to 2020 and set a new high for four consecutive years. Overseas sales also set a new record. In response, Huang Min, President of the Excavation Machinery Branch of the China Construction Machinery Industry Association, summarized that in 2021, the excavation machinery industry has achieved excellent results in overcoming difficulties and moving forward against the trend.
In the first few months of 2021, excavator sales maintained growth, but in the second half of the year, sales continued to decline, which once caused concerns in the industry. Lv Ying, Deputy Secretary General of the China Construction Machinery Industry Association, told reporters that the sales of excavators for the whole year of 2021 are still good, and the total sales are basically in line with expectations.
The sales volume of excavators is regarded as a barometer of the construction machinery industry and an economic indicator. In the construction machinery industry, not only have excavator sales increased, but loader sales have also grown, with only two categories experiencing a decline: truck cranes and pavers. It can be said that the overall situation of the construction machinery industry is not bad, which is completely different from the cycle from 2012 to 2016.
As for the reasons for the formation of the new situation, analysis shows that after the baptism of the previous cycle, the construction machinery industry has become more mature and adaptable. There is a unified understanding throughout the industry that the total scale is relatively stable and cannot undergo drastic changes. Therefore, in expanding the market, industry enterprises have taken actions and avoided them, ensuring that the industry has not experienced a cliff like decline and is still at its highest level in history.
Specifically, construction machinery companies have conducted market research in advance, lowered expectations, unified their thinking, and made corresponding adjustments in terms of capital investment, material feeding, and procurement of purchased parts. The operating conditions of the enterprise, especially indicators such as inventory and accounts receivable, have improved compared to previous years, with growth rates far lower than revenue growth.
Not only has sales been steadily increasing, but the industry resilience of construction machinery has also been effectively improved. The industrial structure continues to optimize, product quality has significantly improved, and the background of intelligent and green development has become stronger. The determination and ability to resist risks and steadily develop have been continuously enhanced.
More than a decade ago, super large excavators weighing over 200 tons had to be purchased from abroad; Nowadays, China can manufacture super large excavators ranging from 200 tons to 700 tons. XCMG Group has successfully developed a 700 ton ultra large hydraulic excavator with independent intellectual property rights called "Four Wheel One Belt" and conducted trial installation, completely breaking away from the previous situation of being controlled by others. In just a few years, it has achieved a "leap in tonnage" and created a miracle of industry development.
With leading technological strength and excellent product quality, the export growth of construction machinery nearly doubled in 2021. The export of construction machinery is expected to reach 34 billion US dollars in 2021, with a surplus of approximately 30 billion US dollars. It should be noted that the export of complete machines in the construction machinery industry has increased, while the import value of complete machines has decreased by 20%.
In 2022, as a typical investment dependent and cyclical industry, the construction machinery industry faces many uncertain factors such as complex international trade relations, intensified competition, rising raw material prices, tight supply chains, and emission upgrades.
China International Capital Corporation predicts that the sales volume of China's construction machinery industry will slightly decline year-on-year in 2022. In the medium term, supported by factors such as overseas market expansion, it is expected that the annual sales of excavators in China will remain stable at around 300000 units in the next three years, without a significant decline. Leading companies are still expected to achieve long-term growth through increasing domestic market share and expanding overseas markets.
The excavator industry should adhere to the innovation driven development strategy, focus on "specialization, refinement, and novelty", accelerate the layout of industrial Internet, accelerate the transformation and upgrading of digitalization and intelligence, promote the mining of advanced machinery industry foundation, modernization of the industrial chain, and self controllable supply chain. By expanding, supplementing, and strengthening the chain, an industrial chain cluster with global competitiveness will be formed, rapidly enhance industrial competitiveness, strengthen risk awareness, create a good competitive development environment, and achieve high-quality and sustainable development of China's mining machinery industry.
