Experts in the industry believe that the reasons behind the continued surpassing expectations for excavators include: the continued issuance of special bonds to promote the acceleration of the implementation of infrastructure projects; environmental protection upgrades are driving demand for industry change.
Special bond issuance boosts infrastructure growth and the market "overcompensation" rebounds
In May, the Politburo meeting emphasized the need to actively expand effective investment, strengthen traditional infrastructure and new infrastructure investment, promote the transformation and upgrading of traditional industries, and expand investment in strategic emerging industries.
From January to April 2020, the total amount of new special bonds issued was 12.239 billion. From the perspective of the proportion of new special bonds used for infrastructure projects, the amount of special bonds issued for infrastructure construction in Q1 was 846.6 billion yuan, accounting for 78.2% of the total amount. %; this year, a cumulative amount of 2.29 trillion yuan has been issued, and the focus is also on infrastructure such as transportation and municipal administration, and strive to complete the issuance by the end of May. The issuance of special bonds has advanced significantly, and the policy signals that have driven the steady growth of infrastructure have become increasingly clear.
The number of operating hours in China in May 2020 was 143.0, an increase of 2.9% from 138.9 in the same period last year, and a substantial increase from the 113.4 operating hours in April. As of June 4, the resumption rate of key projects in various provinces reached 99.3%. Drive excavator sales exceeded expectations.
At present, my country's epidemic prevention, prevention and control warfare has made major strategic achievements. The resumption of production and production of enterprises in the upstream and downstream of the construction machinery industry chain has been vigorously promoted. In addition, the demand for infrastructure construction to catch up has driven the demand for construction machinery and equipment such as excavators.
Environmental protection upgrades, driving industry replacement demand
The construction of equipment for excavators under country three is limited, and equipment upgrades are inevitable. Environmental protection policies are conducive to the replacement of old models, thereby providing additional demand for construction machinery. At present, there are about 1.5 million excavators in the market, and more than 500,000 of China's second and lower equipment.
With the increase in emission standards under environmental protection requirements, the demand for replacement machines is expected to inject additional pull into the sales of new machines for construction machinery companies.
It is estimated that the replacement demand for domestic excavator sales in 2020-2022 will be 138,800, 177,100 and 182,400 respectively, accounting for up to 30% and 50% from 2021 to 2012.
Experts predict that in June, the growth rate of excavator sales is still expected to increase by 50%, and the cumulative sales growth rate in the first half of the year is expected to exceed 20%! Looking back, due to the low base in the third quarter of last year, and the new construction projects after the "two sessions" are expected to gradually land on the ground, the domestic excavator market is expected to appear in the third quarter of the "off season is not weak" situation!
Benefiting from the domestic benefit from the replacement demand brought by the counter-cyclical adjustment of overweight infrastructure investment and industry emissions upgrades, it is expected that the sales volume of the excavator industry will reach 237,700 units, 243,800 units, and 252,200 units in 2020-2022, respectively. +1%/+3%/+3%. Sales will be stable and continuous in the next three years.
