Core components have been under control for many years, the development of construction machinery has been hindered

The 'Twelfth Five-Year Development Plan for the Construction Machinery Industry' issued by the state can still see the constraints of key components to the development of the domestic construction machinery industry. The 'Plan' pointed out that domestic construction machinery involves high-tech and high value-added key supporting components mainly relying on imports, with an average price of more than 80,000 US dollars per ton. For example, transmission components, control components, diesel engines and key hydraulic components are severely in short supply and have excess capacity. There is a strong contrast with structural shortages, which severely restricts the development of China's construction machinery to high-end technical products.

　　 Mainly relying on imported hydraulic components has become a profit killer for domestic construction machinery companies. Huatai United Securities Research reported that imported hydraulic components are so expensive that they eat up 70% of their profits. XCMG Machinery is also well aware of the importance of ensuring Ru0026D investment. Ru0026D expenses account for more than 5% of sales revenue each year. In recent years, XCMG Group’s annual scientific research funding has been more than 1 billion yuan. In 2011, the research funding invested reached 5.7 of sales revenue. %.

　　The competitiveness of core components has been missing for many years, and the development of domestic construction machinery has been stuck

　　Key components are controlled by others and eat up profits. Chang Zheng, director of the International Affairs Department of the Asian Manufacturing Association, said in an interview with a reporter from Chinanews.com that the domestic construction machinery industry still needs to import a large number of core and key components including hydraulic components, engines, control components and transmission systems. part.

　　 Anxin Securities industry researchers said that domestic companies have to bear the high pricing power of accessory suppliers and the supply restrictions of accessory suppliers.

　　 Mainly relying on imported hydraulic components has become a profit killer for domestic construction machinery companies. Huatai United Securities Research reported that imported hydraulic components are so expensive that they eat up 70% of their profits.

　　Hydraulic parts and engines are the two largest components in the cost of construction machinery. These two items can account for as much as 30%-50% of the cost of different domestic models. Take an excavator as an example. Among the various costs of an excavator, only the core components consisting of the hydraulic system and the engine account for 42% of the cost of an excavator.

　　The advantage of demographic dividend is gradually losing, only improving core competitiveness is the magic weapon to win

　　 The development model of China's manufacturing industry largely relies on the product price advantage brought about by the demographic dividend. In 2009, the emergence of migrant labor shortages heralded the end of the era of unlimited supply of surplus labor. Data from the Bureau of Statistics show that the proportion of the population over 65 in China is close to 10%, and the decrease in the proportion of the working-age population will directly adversely affect the construction machinery industry that once benefited from the demographic dividend.

　　 If the economy has maintained a relatively rapid growth rate in the past ten years, due to the large demand for construction machinery in the market, complete machine manufacturers can also partially pass on upstream suppliers through internal tapping and product price increases. Increasing the high cost of parts prices will maintain a relatively stable profitability. However, in today's economic slowdown and declining market demand, the contradiction between core and key parts being controlled by others will become more prominent.

　　Industry expert Chang Zheng told Chinanews.com Financial Channel that relevant national macro policy support, increased government investment, etc., to promote the construction of affordable housing and water conservancy, can directly drive the market demand for related construction machinery in the short term.

　　 But this is not long-term. Chang Zheng emphasized that for the construction machinery industry itself, accelerating transformation and upgrading and supporting independent innovation are the long-term strategies for domestic engineering companies to seek development. Focus on improving the core technology and key technology of the industry, especially the independent production capacity of parts and components.