In the last downward cycle (after 2012), the second-hand mobile phone transaction of China construction machinery boosted the popularity of the second-hand phone auction. Now, facing the new downward cycle, can the second-hand mobile phone business in stock market become a sharp tool for the hedging cycle of construction machinery enterprises?
How much construction machinery does China have?
Cycle change of construction machinery industry is closely related to construction investment demand and equipment quantity, especially equipment quantity. According to statistics of relevant institutions, the number of second mobile phones in Chinese construction machinery market has reached 10 million units. Take a representative excavator as an example. In this recovery cycle (From 2016 to now), excavator sales have risen rapidly, and the number of retained excavators has also risen rapidly. According to the estimate of Excavator Branch, by the end of 2021, the six-year retained volume of excavators in China had reached 1.434 million units, an increase of 21.4% year-on-year; the eight-year retained volume was about 1.636 million units, an increase of 14.6% year-on-year; the ten-year retained volume was about 1.943 million units, an increase of 6.5% year-on-year. If you want to make a big difference from the previous cycle.
In fact, the number of second mobile phones is not good for statistics, so there will be many omissions. At the same time, equipment retention for more than ten years is also great. In addition to the existence of imported second mobile phones, the real data must be far more than 2 million units (the total number of institutions statistics has exceeded 2.6 million units). This value has far exceeded the previous cycle and nearly 1 million more.
Construction needs of the project are those, so many reserves can not be used for construction, which also leads to many excavator owners'equipment "sunning iron", which has resources to do according to work, but no resources, either waiting quietly for spring blossom, or selling the equipment at hand, activating cash flow, transforming and developing. The large holding capacity, tightening environmental protection policies and the upgrade of non-road country four emissions will bring a broad market for the current circulation of second mobile phones.
Ever been a hot auction, will you come back?
Think back to the last downward cycle node, in 2012, which looks like just a decade, a cycle. At that time, due to aggressive sales strategy, credit problems were high in China's construction machinery market, and excessive equipment possession and construction demand reduced by cliff type, resulting in backlog of credit and idle machines, especially bond machines, which mainly affected cash flow, restricted the development of enterprises and even survival.
The more backlog, the more money lost, it is better to sell inferior quality assets of second mobile phones as soon as possible, even at low prices, than at smash hands. As a result, large auctions dominated by easy snap auctions and Leeds brothers auctions were held frequently, mostly at corporate and agent ports. At the same time, the mobile phone circulation market in various regions is also very popular.
So, will the once-hot construction machinery auction come in the new downward cycle?
Based on the current situation analysis, the author believes that: first, there will still be offline auctions, but they will not be concentrated in enterprises and agents, but in the regional secondary mobile phone market, with end users as the main body. The reason is that in recent years, mature and sound business policies of enterprises will still have credit opportunities, but the number is small. More second-hand equipment is centralized in the hands of users and the equipment for sunning iron is idle. It is better to auction it out and stop loss in time.
Second, online auctions will flourish. With the promotion of 5G internet, various kinds of network judicial auction have become more and more mature, such as Ali judicial auction, Beijing-East network judicial auction, etc. At present, there are many excavator auction cases, while byte jump is also in the layout of "dither auction". The network auction will become a trend, and most of the equipment will flow out of users'hands. There is no restriction on the number of participants in the online auction. While increasing the chance of participation, it promotes the maximization of transaction price of auctions, which can greatly reduce the auction cycle and reduce the cost of rental space. The advantages are significant.
Finally, circulation mechanisms are being established and large auctions may never be returned. Although there are still many problems in the transaction of second-hand construction machinery in China at present, after years of development, the degree of market regulation has been improved a lot, especially the entry of many construction machinery enterprises, which also creates better conditions for the circulation of domestic second-hand mobile phones. The auction boom in the previous cycle will digest the stock in a more healthy and sustainable way.
Enterprise Layout Second Mobile Business Response Cycle Downward
In fact, many construction machinery enterprises have already taken a good view of the second mobile phone business, and they are actively planning from establishing the second mobile phone e-commerce platform to the export of the second mobile phone!
Head enterprises such as Xugong, Sanyi, Zhonglianke, Shandong Lingong, Liugong, Shantui and Shanhe Intelligence, whether manufacturers or agents, are speeding up the improvement of the secondary mobile phone business mechanism, ranging from replacement of old machines, recycling and remanufacturing to leasing of secondary mobile phones to holding of secondary mobile phone trade fairs.
Among them, Xugong launched its second-hand mobile phone platform this year, officially certifying various information, at the same time gathering multi-brand used vehicle sources of construction machinery, supporting user equipment replacement, breaking the information island, realizing precise global resource docking, with functions of online bidding, bargaining, intelligent evaluation, and providing professional comprehensive service solutions and financial, insurance, and evaluation to global customers. Logistics and other solutions. Xugong's mobile phone platform directly hits the pain points of the mobile phone industry, such as confused machine sources, redundant intermediaries and inefficient replacement. From this layout, we can see that Xugong is bound to have the mobile phone business.
In addition to domestic brands, foreign brands represented by Caterpillar and Komatsu are positively positioned. For example, Komatsu is promoting high-end circulator business, Caterpillar rental shop business is also in full swing, and construction machinery enterprises have targeted the second mobile phone business.
Export of second mobile phones with a potential of $100 billion to be tapped
At the same time, many enterprises are actively promoting the export of second-hand construction machinery. Among them, Shanhe Intelligent's export case in November attracted attention: a 90% new second-hand SWDM22 rotary drill rig (less than 1000 hours of work) was successfully exported to Uganda with 2.5 million yuan (original price of 3.2 million yuan). The reason why this case attracted the attention of the industry is that the government-enterprise cooperation on the export of second mobile phone is the key to achieve the "ice breaking" of capacity transfer.
Nowadays, China has become the largest manufacturing and selling country and stock market of construction machinery in the world, but the export scale of used equipment is smaller than that of developed countries. At present, there is no "second-hand equipment for construction machinery" in the Customs Catalogue of our country, and most of the equipment is exported by means of "preparation" in the notes for new machines. Second-hand equipment export tax rebate has no policy basis and can not enjoy the new machinery export tax policy; Lack of standards such as quality, assessment, inspection and testing for the export of second-hand equipment, financial institutions can not guarantee financing based on the residual value of equipment; The asymmetric sales market and product information, the lack of overseas sales channels and after-sales support seriously restrict the export of second-hand construction machinery equipment in China.
In November 2021, the Anti-Smuggling Bureau of Huangpu Customs successfully uncovered a used excavator case with a low quotation price, with an initial estimated value of about 550 million yuan.
At the same time, China is constantly importing second-hand mobile phones from Japan, Korea, Europe and the USA, especially from Japan. Due to Japan's tough environmental protection policies and equipment safety performance regulations, a large number of second-hand excavators are idle in Japan. As China's environmental protection and safety regulations are relatively loose compared with Japan, a large number of Japanese second mobile phones are imported into China through free trade, which is bound to impact the domestic second mobile phone market.
Second-hand mobile phones are difficult to get out in China, while foreign countries are constantly flooding in. Assets can not be circulated and there are many problems. Once the difficulties such as customs directory, tax refund policy, specific standards and after-sales service for the export of second-hand equipment of construction machinery can be overcome, construction machinery enterprises will further expand Africa. Southeast Asia and other countries along the "one belt and one road" bring huge market expansion space for the second-hand market of construction machinery. Industry insiders predict that only the export of second-hand construction machinery can increase by USD80 billion annually to USD100 billion.
In a word, it can be seen that the potential of domestic second-hand construction machinery market is tremendous. Whether domestic or foreign brands, there are already countermeasures to deal with them. Early layout is indeed the general trend. The author believes that the Chinese construction machinery market is shifting from incremental market to stock market. Enterprises should cope with cyclical changes. Besides overseas exports, the second mobile phone business is indeed a big tool!
