Market sales are booming
Gao Lei, assistant to the general manager and general manager of the Asia-Pacific region of China Machinery Heavy Industry Group International Equipment Co., LTD., which exports engineering equipment such as medium and large excavators, has not felt the pressure of contraction in the global market recently. Instead, he has felt the trend of recovery more clearly than most foreign traders.
Gao told China Business News that in the first quarter of this year, the company's overall exports are expected to surge 70 to 80 percent year-on-year. The rapid growth is partly due to the release of orders accumulated at the end of last year, and partly because the overseas infrastructure market itself has picked up since February this year.
Not only the medium and large excavator market, as a small excavator industry chain gathering place, Shandong Jining and other factories also ushered in a busy season against the trend.
"Our suppliers and fitting factories around us were also a bit surprised that the market was so fierce. After a few years of expansion, the volume was already high, but now everyone is running at full capacity. It's not that good."
Jiang Zhaoxiang, head of Shandong Haituo Machinery Group Co., LTD., told China Business News that orders have been booked up to two months later, compared with 25 days at the most in the past. "The delivery time is too long for customers, so we are trying to shorten the production cycle while increasing the volume."
China Construction Machinery Industry Association statistics show that in February 2023, 26 excavator manufacturing enterprises sold 21450 units of all kinds of excavators, down 12.4% year on year, including 9958 units of exports, up 34% year on year, not only from negative to positive, to achieve double-digit high-speed growth, and the first two months of excavator export sales also exceeded the domestic sales.
Second, behind the short supply
Although the excavator market showed a significant recovery trend at the beginning of this year, the specific trend and motivation of medium and large excavators and small and micro excavators are quite different because of their different uses. Among them, medium and large excavators are mainly used in municipal engineering or mining and other scenes, while small and micro excavators are mostly used for household or agricultural purposes.
Taking China Machinery Heavy Industry as an example, Gao Lei said that in 2020 and 2021, when the general growth of foreign trade, the company's export has declined compared to the pre-epidemic situation. In 2022, when the contraction pressure of external demand is high, the company's export has increased by 30% ~ 40% year-on-year. In the first quarter of this year, the company's overall export has surged by 70% ~ 80% year-on-year. On the one hand, infrastructure construction has been restored in overseas countries since COVID-19 control was lifted in 2022, and related budgets have been increased to stimulate the economy. On the other hand, their own initiative from the end of last year to explore the market, also let the sales channel power ushered in a greater explosion at the beginning of this year.
For Gao, the most obvious growth and the focus of their efforts are in Southeast Asia and South America, where exports to the Philippines increased by 60 percent in 2022 and Argentina grew by 100 percent. Such growth will continue this year.
According to the data of China Construction Machinery Association, among overseas markets, Southeast Asian market has a large demand for project construction, and the number of hours under construction has been growing continuously for more than 24 months year-on-year. According to Komatsu, the average monthly operating hours in Southeast Asia will be 198 in 2022, two to four times that of any other region or country.
As a domestic industry leader, Xugong Machinery (000425.SZ) said in response to investor questions on the interactive platform in late March that the export of Xugong Machinery to countries and regions along the "Belt and Road" accounted for about 70% of the company's total export, and its products covered 63 countries and regions along the Belt and Road. The company recorded a record export year in 2022 and expects exports to continue to grow in 2023.
For small and miniature excavators, the trend of growth has been for some time, is the beneficiary of the "house economy".
The head of construction machinery industry operations at Alibaba International Station told China Business News that the export of small excavators has been growing for two years. Different from the market performance of medium and large excavators outside Europe and the United States, such as Southeast Asia and the Middle East, the main export market of micro and small excavators is still in Europe and the United States. Affected by the "house economy" and so on, micro and small excavators for household and agricultural use conti
