Machinery / Industrial Parts & Tools

Boosted by the construction of "Baojiaolou" and infrastructure projects, the total monthly sales volume of excavators in China has grown positively year-on-year for four consecutive months since July. According to the observation report of Huacheng import and export data, 20501 excavators of various types were sold in October, up 8.1% year on year.

"The gradual recovery of excavator sales is mainly due to the gradual improvement of domestic demand, the rapid growth of exports, and the low base effect. In fact, the overseas sales scale of China's excavators is getting closer to the domestic scale, and even exceeds the domestic scale in some months this year, which reflects the gradual enhancement of the competitiveness of China's excavators in the overseas market." The relevant responsible person of Sany Heavy Industry said.

Demand recovery

Excavators are wind vanes reflecting economic changes such as infrastructure construction and observation of fixed asset investment.

According to the observation report of Huacheng import and export data, 20501 excavators of all kinds were sold in October, with a year-on-year growth of 8.1%, and the year-on-year growth rate of sales for four consecutive months was positive. Among them, 11350 were sold domestically, up 7.9% month on month; The year-on-year decrease was 9.91%, narrowing for three consecutive months. 9151 sets were exported, with a year-on-year growth of 43.8%, maintaining a high growth trend.

The person in charge of Sany Heavy Industry said: "The sales volume of excavators in China has gradually warmed up. On the one hand, the government has issued a series of stable growth policies to boost the downstream demand of the construction machinery industry. Since late September this year, the downstream construction has been significantly improved, even reaching the best construction status this year. On the other hand, overseas sales have maintained a rapid growth trend, effectively hedging the decline in domestic sales."

The person in charge of XCMG Machinery said: "XCMG excavator has always maintained its leading domestic sales in recent months, and its domestic market share has stabilized at about 21.5%."

Driven by the traditional construction peak season of "golden nine and silver ten", China's infrastructure investment has shown a sustained momentum.

According to the observation report of Huacheng import and export data, the average operating rate of China's construction machinery in October was 64.07%, which was 2.23 percentage points higher than the average operating rate of 61.84% in the first three quarters, reflecting that China's infrastructure investment continued to maintain a stable upward trend.

Accelerate international layout

According to the data of China Construction Machinery Industry Association, since April 2021, the sales volume of domestic excavators has declined for 19 consecutive months on a year-on-year basis, while the export has maintained a rapid growth trend.

From January to October this year, China sold 220797 excavators, down 26% year on year. Among them, 131340 were sold domestically, down 46.4% year on year; 89457 sets were exported, with a year-on-year growth of 67.3%. Huacheng's import and export data observation report.

"The export scale is getting closer and closer to the domestic scale, even surpassing the domestic scale in some months this year, reflecting the gradual enhancement of China's excavator overseas competitiveness." Said the relevant person in charge of Sany Heavy Industry.

With the rapid growth of construction machinery export, the overseas revenue of China's listed construction machinery companies is also growing rapidly. Take Sany Heavy Industry as an example. According to the import and export data of Huacheng, in the first nine months of this year, the company achieved an international sales revenue of 25.88 billion yuan, up 43.7% year on year. At the same time, Sany Heavy Industry's excavator market share in the world has rapidly increased, with the overseas market share exceeding 8%. In the United States, Britain, Italy and other major overseas excavator markets, sales revenue has achieved a rapid growth of more than 60%.

Liu Jiansen, vice president of XCMG Machinery and general manager of XCMG Import and Export Corporation, said: "At present, XCMG Machinery has more than 300 dealers overseas, more than 1000 sales outlets, 5000 service and sales personnel, and has strong global service and sales capabilities, which really realizes internationalization."

The above person in charge of Sany Heavy Industry said to the reporter: "Internationalization strategy is one of the most important strategies of Sany Heavy Industry. In the past two or three years, the company has increased its efforts to expand the market in developed countries, established an international research institute, and developed products suitable for overseas markets. At the same time, the company has also increased its efforts to build a supply chain system for overseas sales and service channels, brands, and accessories."

Orient Securities said that the domestic construction machinery market is at the bottom stage, while the overseas market has become a new growth pole of the industry. The leading domestic construction machinery enterprises seize the opportunity to actively layout the overseas market, and the global competitiveness is expected to continue to improve.

Prosperity is expected to rise

On November 16, Meng Wei, spokesman of the National Development and Reform Commission, said that at the end of July, the State Council deployed policy based development financial instruments to increase financing support for major projects. Up to now, 739.9 billion yuan of policy oriented development financial instruments have been fully invested, most of the supported projects have been started, and the physical workload is being accelerated.

Zheshang Securities said that with the intensive commencement of infrastructure projects, the power of infrastructure construction is obvious. The demand for excavators continues to increase, and the sales volume is expected to continue to rise.

The above person in charge of Sany Heavy Industry said: "In October, except for excavators, other construction machinery products also achieved good sales. From the current point of view, the overall demand of the construction machinery industry in the fourth quarter may be a period of good demand boom this year."

According to Dongguan Securities, the issuance of special bonds will speed up in 2022, and the government will propose to comprehensively strengthen infrastructure construction, so the prosperity of the infrastructure industry will recover. In addition, it is expected that the advance approval of special bonds in 2023 is expected to be issued early, which is conducive to the rapid implementation of infrastructure projects in the first half of next year, thus boosting the demand for construction machinery.