Construction Machinery Market Will Continue To Boom In 2020: The Third Quarter Will Continue To Grow At A High Level

7. August is the off-season of construction machinery industry, but this year's off-season is not weak.

In July, the year-on-year growth rate of excavators exceeded the market expectation by 54.8%. According to another industry survey, the sales volume of excavators (including export) in August is expected to reach 20800 units, with a year-on-year growth rate of about 50%.

As of the end of August, the major construction machinery newspapers have been published in succession. The report shows that most of the head companies are showing a growth trend. For example, Zoomlion's main business grows steadily, and the sales of cranes, concrete machines and excavators are outstanding. Sany's net profit exceeded 8.4 billion yuan, its revenue increased by 13% year on year, and its net cash flow increased by 12.54%. XCMG crane and other products continued to develop, with significant quarter on month growth in the second quarter.

Recently, at the bices2021 press conference, Qi Jun, President of China Construction Machinery Industry Association, said: although affected by the epidemic in the first half of the year, thanks to the remarkable achievements made in the prevention and control of epidemic diseases in China, from the statistical data of the association, the sales volume of construction machinery in the first half of 2020 will improve month by month.

"Looking forward to 2020, it is expected that the domestic construction machinery market demand will grow steadily. Judging from the current international new epidemic situation, the export of construction machinery will be under great pressure this year, and more efforts are needed to maintain growth. It is estimated that the industry growth rate will reach 7% - 8% in 2020. " Qi Jun pointed out.

Off highway, a market research and forecasting company According to the research report, the new crown epidemic will lead to a decline in the sales of construction machinery in almost all countries in the world this year. It is estimated that the global sales of construction machinery will drop by 16%. However, China's policies are expected to boost the sales of construction machinery in China by 14%, making the sales of construction machinery in China reach the highest level since the stimulus boom of 2010-2011.

High industry prosperity

From January to July, 12 kinds of complete machine products, such as excavators and loaders, which were included in the statistics of China Construction Machinery Industry Association, sold 797929 sets, with a year-on-year increase of 18%, and 138182 sets were exported, with a year-on-year increase of 3.46%. From January to July 2020, the total operating revenue of key industry related enterprise groups was 235614560000 yuan, with a year-on-year increase of 17.3%. The sales situation in the first half of the year showed a trend of low before and high after.

In August, according to the survey of CME construction machinery network, the sales volume of excavators (including export) reached 20800 units, with a year-on-year growth of about 50%. During the period, the domestic market sales volume reached 18500 units, with a year-on-year growth of 60%; the export market sales volume reached 2300 units, basically flat.

Heavy truck market is also constantly breaking records. From January to August this year, the cumulative sales of domestic heavy truck market was about 1.0835 million, with a cumulative year-on-year growth of 35% from 30.5% from January to July this year, with a net growth of nearly 280000 vehicles. According to the first commercial vehicle network analysts, according to this growth momentum, the heavy truck market annual sales reached 1.4 million, setting a new record of several percent.

According to the 2020 interim report of construction machinery companies, as of September 2, except for construction equipment, the remaining 11 construction machinery companies' net profit attributable to their parent companies increased. Zhejiang Dingli, Aidi precision, Zoomlion, Hengli hydraulic, Sany Heavy Industry, etc. were the top companies in terms of revenue and net profit growth.

Among them, Zhejiang Dingli's revenue and net profit attributable to its parent company increased by 77% and 57% year-on-year, which is due to the company's outstanding performance in the field of aerial work platform segmentation and accelerating the development and promotion of new products.

On August 27, the semi annual report of Liugong in 2020 showed that its operating revenue was 11.549 billion yuan, with a year-on-year increase of 14.00%; the total profit was 845 million yuan, with a year-on-year increase of 1.29%; and the net profit attributable to the owner of the parent company was 678 million yuan, with a year-on-year increase of 2.67%. From the product point of view, Liugong's core products loader, excavator, roller, bulldozer market share increased significantly.

As for the construction machinery industry, Zeng Guangan, chairman of Liugong, analyzed to the 21st century economic reporter that the resumption of work and production of enterprises and industries has increased the demand for the construction machinery industry, and the national macro policies are also conducive to the development of the industry. "The expansion of domestic demand investment plays an important role in driving the demand of construction machinery, including urbanization, beautiful rural construction, new infrastructure construction, western development, Dawan district construction, etc., and the loose monetary policy is conducive to the development of the entire engineering industry." Zeng Guangan said.

Under the situation of zhangtai engineering industry, many bright spots of epidemic prevention and control in the machinery industry of zhangtai are presented. First of all, the whole industry and upstream and downstream enterprises are in good condition to resume work and production; secondly, the production and sales volume of major products in the industry have increased greatly; thirdly, a batch of new products and new technologies have emerged in the industry, and the investment of enterprises in innovative technology has not been affected by the negative interference of the epidemic, on the contrary, there is an increasing trend; finally, there are a number of major technical equipment and high-end equipment development in the industry are accelerating It provides endogenous growth power for the development and innovation of the whole industry.

Ni Zhengyang, an analyst with Southwest Securities construction machinery industry, pointed out that affected by the epidemic situation in the first quarter, the commencement of some projects was delayed and the demand for construction machinery products was pushed back. After the epidemic subsided in the second quarter, the construction of major projects accelerated, and the industry demand was hot. Specifically, the top enterprises have sufficient orders, products in short supply, outstanding performance, and some enterprises have achieved the highest growth rate since recovery.

Superposition of multiple factors

Chen Bin, executive vice president of China Machinery Industry Federation, pointed out that at present, the recovery of production and operation of the machinery industry has achieved phased results, and the difficulties and problems encountered in the early stage have been alleviated to varying degrees with the improvement of the epidemic situation. However, there are still many difficulties and pressures in striving to realize the steady economic growth of the whole year. Due to the high market demand, the construction machinery industry is running better than expected, but the export is facing certain pressure. It is expected that the construction machinery industry will maintain a certain growth rate throughout the year.

In the second half of the year, with the improvement of the domestic epidemic prevention and control situation, on the one hand, the domestic financing environment improved and the infrastructure construction continued to advance; on the other hand, with the development of artificial intelligence, environmental protection policies accelerated the upgrading of stock equipment, and most analysts predicted that the construction machinery industry would maintain a growth trend in the second half of the year.

Minsheng securities analyst Li Feng analysis that the superposition of multiple positive factors, is expected to extend the business cycle of construction machinery. Firstly, the strong support of downstream infrastructure investment and the support of macro policies for stable growth ensured the demand for construction machinery products; secondly, the old equipment under the second national level and related orders accounted for about 50% of the total number of excavators. With the improvement of emission standards under the environmental protection requirements, the renewal of demand injected power into equipment sales. Moreover, the improvement of equipment investment rate of return and the replacement of manpower in the construction process further broaden the market space of equipment.

Yao Jian, an analyst at Guosheng securities, also judged that the improvement of the financing environment and the growth rate of infrastructure investment will make the construction machinery high outlook expected to continue. On the policy side: since the second half of last year, the "broad credit" policy for infrastructure projects has been intensively introduced. At the monetary end, financing has improved significantly this year, with M2 growth rate increasing continuously since January, reaching a high level of 10.7% in July. The improvement of financing environment is a solid foundation for the growth of infrastructure investment.

From the perspective of "Wanlian" and "Wanlian", it is expected that the machinery industry will continue to grow under the background of "one super boom" and "Wanzhong machinery industry".

Mechanical engineering manufacturers are also optimistic about their own prospects in the second half of the year. At the recent performance presentation meeting, the relevant executives of Zoomlion analyzed that, affected by the epidemic situation, the construction peak season of this year's construction machinery industry was delayed by 2-3 months, and it is expected to maintain a high growth rate in the third quarter. At the same time, with the domestic major cycle as the main body and the domestic and international dual cycle promoting each other, the construction of "two new and one high" continued to advance in the second half of the year, plus one Large and large projects have been implemented one after another, and the industry will still maintain a high prosperity.

However, people from China Construction Machinery Industry Association said that the operating pressure faced by domestic construction machinery enterprises has not fundamentally changed. In addition, the construction machinery products have the characteristics of long production cycle, and the procurement cycle of some imported parts is also long. With the superposition of overseas epidemic situation and political influence, the export pressure of domestic construction machinery enterprises may not be relieved in the short term.

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