On the afternoon of August 23, 2022, the 19th China Construction machinery development high level forum held by China Construction Machinery Industry Association was grandly held in Changsha, Hunan, with the theme of "new stage, new pattern and new action".
High level dialogue (I)
Dialogue guests: Yang Hongjun, chairman of Shaanxi Construction Machinery Co., Ltd.; Gong Jianfei, chairman of Beijing Construction Mechanization Research Institute Co., Ltd.; Zhang Min, general manager of Shantui Construction Machinery Co., Ltd.; Xigang Jisi, general manager of Kobelco construction machinery (China) Co., Ltd.; Zhou Jun, general manager of Anhui Heli Co., Ltd.; Wu Qingfeng, general manager of Inner Mongolia North Heavy Truck Co., Ltd Liu Changcheng, general manager of Fangyuan Group Co., Ltd., presided over the high-level dialogue (I) by honorary chairman Qi Jun.
High level dialogue (I) site
Qi Jun: we have invited seven representatives of enterprises this time. We hope that they will be brief and to the point, pool their wisdom and spark wisdom. First of all, please briefly introduce the basic situation of the company in the first half of the year, and then talk about how your company understands the "new" in the "new stage"? Does it include the start of a new operation cycle?
Wu Qingfeng: North Co., Ltd. is a specialized production enterprise with off-road mining dump trucks as the core. It is a so-called large product and small market.
In the first half of this year, CNNC focused on "two wheel drive" - scientific and technological innovation and management innovation, and continued to make efforts to "three intelligences" construction of intelligent manufacturing, intelligent products and intelligent parks. The so-called smart mine construction is driverless. The mine is relatively closed and the environment is harsh, which requires high-intensity operation of the mine car. In just four years, the company has realized the operation of 200 unmanned mining cars of various types in 15 mines in China. Through the continuous exploration of the scene and the continuous improvement and maturity of the technology, the construction of domestic smart mines has been promoted, and the construction of smart mines has been promoted to reduce carbon.
The promotion and application of new technologies have greatly promoted the sales of products. At the same time, as the mining situation has entered a strong cycle, the sales of products of northern shares increased by 68% in the first half of the year compared with the same period of last year, realizing the batch sales of mining vehicles. The pace of product internationalization has been accelerated and has been expanded to 67 countries and regions.
Adhering to high-end, international, green, intelligent and networked is the development direction of CNNC. Although there are still some gaps between the products and the world-class brands, we combine domestic manufacturing resources and make joint efforts to follow the route of high-end open-pit mining, so that the mining equipment industry can better go to the international market and create a new business card for Chinese enterprises in open-pit equipment.
Xigang Jisi: the sales volume of the excavator industry in the first half of this year is almost "halved". I think that the decrease of the whole year of 2022 is about 45% compared with that of 2020. Focusing on the theme "new", I believe that new science and technology will bring new business forms, new business models and new values to the industry in the future.
This year, excavators ushered in the transition period of "national Fourth" switch, and ushered in the real electric period of excavators. In the future, remote operation represented by driverless or 5g or even 6G technologies will become the mainstream in this industry around 2030.
In the new stage, in the first half of this year, the second plant in Hangzhou was closed and the production in Hangzhou was integrated into the first plant - Chengdu. When the market recovers in the future, the number of production excavators in its single plant will also exceed 7000, which can ensure the market supply capacity of Kobelco.
Product cost performance is a manifestation of new value, and customers have other value needs. It is hoped that in the future, electric excavators will bring new value experience to customers, and the industry association will vigorously promote the electrification of excavators.
Gong Jianfei: from January to July this year, real estate has a great impact on the business of Beijing Construction Machinery Research Institute. However, our infrastructure sector has achieved good growth through scientific and technological innovation, with a substantial increase compared with last year. I'd like to talk about the new cycle and understanding.
In December 2001, China joined the World Trade Organization (WTO). In May 2020, the central government proposed to build a new development pattern of domestic and international double circulation and mutual promotion based on the domestic economic cycle, which is to meet our new challenges in the process of globalization.
In the period of nearly 20 years, China's construction machinery has experienced a rapid development. China's construction machinery industry has become a manufacturing country through introduction, absorption, digestion and innovation. Although some of our products have entered the world's top industries, they are still subject to technical barriers such as high-end engines, chips, materials and high-precision CNC lathes, and are still at the middle and low end of the global industrial chain and value chain. In the past two years, we have also suffered from the trade war initiated by the United States and the technical barriers to trade, including de sinicization and hard decoupling; In addition, the repeated impact of the epidemic and the impact on the supply side, including the contraction of the sales side and even the weakening of consumer expectations, have brought many difficulties. However, due to the proper prevention and control of the epidemic, we have achieved a rapid growth in the export of construction machinery despite the disruption of the supply chain in Europe and the United States.
With the fierce confrontation between China and the United States, we must establish the bottom line thinking of high-tech disconnection and hard decoupling. With the normalization of the epidemic in Europe and the United States, will China's construction machinery exports continue to grow at a high rate next year and the next year? In this case, the way of national macro-control cycle is to promote infrastructure construction, including old infrastructure and new infrastructure, based on the domestic circulation and jointly build the "the Belt and Road".
At present, 40 foreign versions of national standards for the construction machinery industry have been published. In the first half of this year, the National Standards Committee reviewed and approved 10 standards. At the same time, we used the platform of the international standards committee to organize domestic relevant units to establish ISO international standards. Among them, 10 projects were established and 8 were released, which promoted the development of the industry.
The new development requires us to realize scientific and technological innovation and digital transformation and upgrading, and then realize the transformation from a manufacturing country to a powerful country. At this time, the international background, including the transformation of labor force and the change of hard scene, requires entrepreneurs to think about the future development of enterprises with new vision, just as chairman Qi said, "challenges and opportunities coexist".
Yang Hongjun: Shaanxi coal group, one of the world's top 500 enterprises, is the controlling shareholder of Shaanxi Construction Machinery Co., Ltd. (hereinafter referred to as Shaanxi Construction). In the past two years, Shaanxi construction has transformed and transformed from pavement machinery manufacturing to an industrial system combining tower crane manufacturing and leasing. At present, the company has 11000 tower cranes, with a total assets of 16.8 billion, covering 40 subsidiaries nationwide, 6 overseas subsidiaries and 14 manufacturing bases. Judging from the situation in the first half of this year, our overall leasing and manufacturing scale decreased by 20%, mainly because of the Shanghai epidemic and the Xi'an epidemic, which have been suspended for nearly four months.
Only when we unswervingly do a good job in leasing services and the tower crane industry can we cope with the current domestic and international uncertain epidemic normalization environment. I firmly believe that as long as we work hard, we will certainly make contributions to China's service industry.
Zhang Min: in the first half of the year, the domestic construction machinery market can be described as a double heaven of ice and fire.
On the one hand, we are experiencing the most difficult period in the past decade. Taking the bulldozer market as an example, from January to July this year, only 3893 vehicles were sold, and the sales volume was basically halved. It is basically difficult for enterprises to survive on a single business. On the other hand, we are also facing a very good export prospect. In the first half of the year, our export market grew the most significantly compared with that in the past decade. Under such a bad situation in the domestic market, the overall decline was only more than 10%, and the profit was slightly higher than before. These mainly benefit from the gradual acceleration of the internationalization process.
In order to seize the development opportunities, Shantui has made great efforts to promote the international and domestic double circulation. We will focus on the three aspects of high-power, new energy and intelligent construction. Among them, intelligent construction is the top priority of enterprise development, focusing on earthwork, roads and mines.
Zhou Jun: the forklift products developed by Anhui Heli belong to the field of industrial vehicles. In the first half of 2022, the number of forklifts dropped by 11.14%, while Anhui Heli has successfully realized product transformation through product technology innovation in recent years. Similar to the general trend of the construction machinery industry, Anhui Heli's export volume in the first half of this year saw a significant increase and reached a record high. In combination with these aspects, although the sales volume of industrial vehicles in the first half of this year decreased by 11%, the revenue and profit of Heli achieved positive growth.
China's construction machinery market is now entering a new stage. I think the "new" in the new stage is mainly divided into the following three aspects:
1. Environmental change: the construction machinery and industrial vehicle enterprises are facing great changes that have not been seen in a century. The Sino US trade war and economic anti globalization have all posed new challenges.
2. Technological innovation: product technological innovation and technological transformation, as well as industrial transformation, have brought us new opportunities, especially with the technological innovation and technological transformation in intelligent networking and unmanned.
3. Policy Innovation: in recent years, with the second centenary goal put forward by the state, the central government and the state have attached great importance to the real economy and constantly introduced new policies, which has brought new impetus to economic development.
Qi Jun: Mr. Hecha Zhou has a profound understanding, which is in line with the theme and emphasizes the "new" understanding. In the statistics of the construction machinery industry, only the industrial vehicle sector has more than one million units, and the export volume is also the largest.
Liu Changcheng: Fangyuan group is a large cross industry company focusing on concrete machinery and construction lifting machinery, supplemented by other industries. In the first half of this year, the overall situation of concrete machinery, especially construction hoisting machinery, was very grim, with an average decline of about 55%. However, thanks to 52 years of deep cultivation in the concrete machinery industry, Fangyuan group's concrete machinery module in the first half of the year remained flat or even slightly increased. In addition, unlike the industry, Fangyuan group has always insisted on self-development and has not been listed yet. In the face of the new world pattern, new competitive formats and new development opportunities, Fangyuan group will carry out innovation and innovation by continuously meeting the market demand and the needs of new customers.
Internationalization is a very good performance support point. Fangyuan group will continue to implement the international development strategy. As early as the beginning of 2000, Fangyuan group went abroad to participate in international competition, and accumulated a lot of experience in product performance, quality, packaging, transportation and adaptability to foreign climate.
The domestic market is the largest segment of the entire international market. Although the current situation is not favorable, we firmly believe that under the environment of large infrastructure construction, we will continue to deepen and innovate in the market segment, and will still usher in more opportunities in the future.
Qi Jun: Shantui, Fangyuan, Shaanxi construction, heli, and northern Inner Mongolia. As domestic manufacturing enterprises, how do they view the impact of domestic and international double circulation on their own enterprises? Where are their starting points?
Wu Qingfeng: domestic and international circulation is the only way for enterprise development. NORINCO's mining car is a high-end equipment manufacturer. At present, all core parts are from the United States. While doing a good job in the domestic market, we will focus on green, unmanned and intelligent mines with technological innovation, strengthen our skills, lay a solid foundation, improve the cost performance of our products, abide by the international rules of the game, and actively go to the international market.
At this stage, it is necessary to strengthen the localization of upstream and downstream supply chains by leading enterprises in the industrial chain, such as promoting the integration of domestic enterprises such as high-power engines, electronic control systems and high-power gearboxes, and increasing the localization, so as to greatly reduce costs and enhance the competitiveness of products.
Yang Hongjun: at present, our tower crane leasing service accounts for 95%, and the future starting point is to strengthen the service. No matter what difficulties we encounter, we will provide customers with all-round tower crane service and provide customers with a safety guarantee.
Compared with the rental data statistics of the association, the company's rental orders for three consecutive weeks accounted for 80% of the domestic. This shows that dozens of our domestic subsidiaries have provided thoughtful and considerate services around the tower crane, which has been recognized by China railway construction, China Construction, including local state-owned enterprise users.
Zhang Min: the foreign circulation is very important to Shantui. This year, the proportion of overseas exports will basically reach half by the end of August. It is hoped that the state will continue to intensify its opening up to the outside world, so that all enterprises can go to sea together.
Our future starting point is the first large horsepower, the second new energy products, and the third smart construction. Smart construction will be the focus business of Shantui, focusing on earthwork, roads and mines. Start with remote control to realize remote control operation; Then, realize "one dragging many" and realize local intelligent construction; Finally, the ultimate goal is to realize the electric, unmanned and integrated construction of all products of the group.
Zhou Jun: Anhui Heli has laid out its internationalization strategy since the 12th Five Year Plan. In the five years since 2018, heli's overseas sales revenue has increased by more than 30%, reaching more than 60% each year in the past two years. In the first half of this year alone, Anhui Heli's export revenue increased by 68%, so internationalization is very important for Heli's future development.
In the future, heli will make efforts in the following two aspects:
1. Products.
（1） The overall solution of intelligent logistics based on unmanned forklift and IGV will be a development direction of industrial vehicles in the future. We have established a special company for this purpose. It is expected that the marketing of this sector will double in the next few years.
（2） New energy direction based on lithium battery and hydrogen energy.
2. Market.
As a leading enterprise in the domestic forklift market, heli will focus on the domestic aftermarket - the proportion of service-oriented income.
Accelerate the international transformation and increase the revenue of domestic service sector.
Liu Changcheng: internationalization is a very good performance support point. At the beginning of 2000, Fangyuan group went abroad to participate in international competition and accumulated a lot of experience. The domestic market is the largest segment of the entire international market. We firmly believe that under the environment of large infrastructure construction, there are still opportunities for continuous deep cultivation and innovation in the segmented market.
Qi Jun: I'm glad to hear that Shaanxi construction and Heli talk about service. I think that the current mainframe enterprises have come to the point that they should not regard new machines as the main revenue generation, but should switch to back market services.
Caterpillar, one of the world's top 500 companies, had an overall sales revenue of about US $40 billion and a service revenue of US $14 billion in 2016. Caterpillar plans to double its service revenue in the decade from 2016 to 2026, and caterpillar's service will account for us $28 billion by 2026. This poses a problem to our host enterprises. The service income of our front market and rear market needs to be strengthened urgently to reverse the development thinking of taking new machines as a single innovation force.
I would like to ask chairman Gong Jianfei how scientific research institutes deepen innovation work around industry development, promote industry university research cooperation, and speed up the construction of research platforms?
Gong Jianfei: first, our growth actually comes from scientific and technological innovation. In combination with the requirements of the new era, precise innovation is required, that is, around the needs and pain points of customers.
Second, in response to the current characteristics of less people, automation and information technology should be used to replace the original labor-intensive mode.
Third, we focus on intelligent products and later maintenance market, and put forward four wisdom: intelligent manufacturing, intelligent equipment, intelligent management and intelligent service.
The characteristics of innovation required in the new stage are interdisciplinary intersection, integration, technology iteration and localization substitution.
To this end, we have done a lot of work: establishing an open, shared and cooperative new R & D platform, including the acquisition of scientific research funds, the ownership of intellectual property rights and the distribution of income from the transformation of achievements in the process of digital transformation.
We give play to the advantages of the industry platform to serve the industry and promote the scientific and technological progress of the industry. At the same time, we use the international standardization platform to jointly promote the "going out" of standards and provide conditions for our products to "go out".
Qi Jun: how does Kobelco, as a foreign-funded brand, view China's domestic circulation? How to give consideration to domestic and international double circulation, how to implement the goal of double carbon, and what is your company doing? What are the suggestions on China's emission policy? With the decline of the market, the decline of Kobelco is faster than that of domestic enterprises. What are your thoughts to deal with it?
Sikokakis: I'm very sure that China is dominated by domestic circulation. As a large economic country, China has huge market demand potential, especially in the construction of rail transit, urbanization, new rural construction, and water conservancy facilities. There is still great space and potential in the future.
In the future, with the change of the age structure of China's population, the productivity population will gradually decrease before 2050. It is believed that the demand for unmanned driving and remote control will gradually appear and strengthen.
In order to implement the double carbon emission reduction target, the future will definitely focus on the research and development of corresponding technologies, including the electrification of products.
The share of foreign brands in the excavator market has been shrinking, and the proportion of Chinese and foreign brands has been greatly reversed. Even this year, the proportion of foreign brands has dropped below 20%. The number of foreign brands that may be left in the future is 20000-30000. At present, there is a structural oversupply problem in the Chinese market. The total capacity of Chinese and foreign investment exceeds 400000 units, which greatly exceeds the demand of the Chinese market. At present, the market share of Kobelco is small, and it may be at the low level of 2000 units in the future. We must implement relevant cost reduction and control, or we can create profits.
The level of China's supply chain and suppliers is constantly improving, and the quality of our products is also developing by leaps and bounds. China, as the world's largest construction machinery market, will never change. In the future, China will definitely become a highly internationalized market with two-way flow of technology and product import and export. Kobelco hopes to have a place in such an important and developed market.
Qi Jun: as the executive director unit of our association, we wish the steel can develop rapidly in China. Now I would like to ask Mr. Zhang of Shantui, as the head enterprise of bulldozer industry, how does Shantui view the application prospect of new energy engineering machinery products? How to give consideration to the coordinated development of the whole machine and key parts?
Zhang Min: as a leading enterprise in the bulldozer industry, Shantui also believes that the trend of new energy has long been irreversible, and the penetration rate of new energy products will only be higher and higher in the future. From the perspective of an ordinary user, the cost of electricity is indeed much less than that of oil. The 5-ton electric loader can save nearly 100 yuan per hour than the oil loader. If the cost of the three power plants can be reduced by 30% - 40% in the future, various machines may have rolling advantages over the oil tanker.
Moreover, as far as the current development situation is concerned, we can surpass foreign giants in terms of the three power companies.
It is precisely for these reasons that Shantui has started to make electric bulldozers and electric loaders since 2019, and has already formed mass sales this year. Although there are only about 600 5-ton electric loaders in the whole industry this year, the penetration rate is only 1.3%. However, from the development of heavy trucks in the past two years, the trend of electrification is very obvious, which has reached 4.3%, so the trend of electrification is irreversible, and Shantui is embracing it heartily.
In addition, for Shantui, parts are very important.
Because we can see from the epidemic situation in the past two years that the self-sufficiency rate is the guarantee of products. In this regard, Shantui is constantly improving in the development of high-end parts, including the gearbox and the four-wheel belt, and is striving to achieve self-sufficiency. Next, Shantui's positioning of components is to lead the development of domestic components to high quality.
Qi Jun: Shantui's "four wheels and one belt" parts have indeed received a good response. I hope Shantui can do better in the development of parts. What is the new plan of "manufacturing + leasing" of Shaanxi construction? How to position the market in the next step?
Yang Hongjun: we are "manufacturing + leasing + remanufacturing". The 14 bases are 14 small tower crane production plants, with a scale of 60-100 mu. We want to extend manufacturing + leasing to remanufacturing, because the problem we are facing now is that the construction unit requires to rent a new tower crane for 1-3 years, and the income of the tower crane is basically 7 years, which is a challenge to our heavy asset industry based on leasing services.
At present, there are an estimated 450000 tower cranes in China. If the rental rate is about 55%, nearly 200000 tower cranes are idle on average every day. Therefore, we want to make this full life cycle tower crane serve users well. Therefore, our 14 bases are all equipped with modern layout, high-end spraying and high-end assembly, so as to completely serve all users. I hope to get the support of the association and do a good job in remanufacturing. Qi Jun: Heli is in the forefront of the industry in the electrification of industrial vehicles. What are the measures for the electrification of industrial vehicles in the future? In addition, what is the proportion of Heli electrification and what is the proportion of lithium batteries?
Zhou Jun: in terms of electrification, heli will carry out layout in the following three aspects:
1. Integration of electric product supply chain based on "three power".
2. Layout the whole series of products. At present, heli has listed 0.8-18 tons of lithium battery products, and the electric products of the front crane and stacker are under development
3. Performance substitution. In terms of performance, ergonomic design and comfort, electric products should replace or even exceed internal combustion.
At the same time, Anhui Heli has made a comprehensive layout in the post market service of electric products, including equipment leasing, financial leasing and accessories.
In the first half of this year, electric products accounted for 50% of Heli. There is still a gap with the industry average of 62%. And electric products only account for 25% of Heli's total revenue. Among them, although all small three types of vehicles are electric products, they do not have much weight in revenue.
In the future, at the end of the 14th five year plan, heli aims to achieve 50% of the revenue of electric products. The number of units reached 70%, of which lithium battery products should be the absolute main force, accounting for more than 80%.
Qi Jun: there are many products in Fangyuan. How much does each account for? In the next long-term development, will the proportion of construction machinery in the whole plate increase or decrease?
Liu Changcheng: at present, the concrete machinery and construction cranes of Fangyuan group account for 70% - 80% of the company, and other industries account for 20% - 30%. Fangyuan group has been engaged in the field of concrete machinery for more than 50 years, leading the industry in brand awareness and reputation, and has accumulated a lot of experience and market resources. The company will always take the concrete machinery sector as the main development direction, and other industries as a powerful supplement to cope with the market adjustment period. The main and auxiliary industries will go hand in hand, so that the enterprise can maintain a long-term and stable profitability.
Qi Jun: Fangyuan group is a very pragmatic enterprise. Next, I would like to ask general manager Wu of North heavy industries. Under the background of intelligent mines, how to maintain high-quality sustainable development of enterprises through technological innovation? How to use the combination of mining vehicles and new technologies such as automatic driving and artificial intelligence to provide optimized services for the whole life cycle of mining vehicles?
Wu Qingfeng: North China Co., Ltd. has cooperated with all the leading enterprises in China to actively improve the technology and manufacture intelligent and green energy enabled mining cars, with broad prospects.
Main methods:
First, cooperate with excellent institutions in China, such as Tsinghua research and development of hydrogen energy; The Department of aerospace, the Chinese Academy of Sciences, and the Department of China University of Mines developed unmanned vehicles. As a leading enterprise in the industrial chain, CNNC integrates high-quality resources, jointly promotes technological innovation, and maintains high-quality sustainable development of the enterprise.
Second, the electric drive system is now used by General Electric (GE) and Siemens. We have cooperated with CRRC, Harbin Electric Power Co., Ltd. and First Heavy Industries Co., Ltd. to jointly tackle the key problems of electric drive system, promote localization, and reduce the cost by more than 30%.
The company has great opportunities and prospects for future development. We transform from manufacturing and sales to service providers and provide integrated solutions. Now, the first project in China - the investment of national energy group in Xinlinhe. The company has 24 100 ton mining cars to serve it. Driverless construction, full life cycle guarantee, and ten-year service are charged by ton kilometer. The prospect is infinite.
Qi Jun: how do you expect the government or associations to play a role in the domestic market competition environment? You can forecast the development trend of construction machinery industry in the second half of 2022 and this year. Express it concisely in two sentences.
Wu Qingfeng: I'm disgusted with the chaotic competition in the Chinese market. I hope the association can actively guide enterprises to participate in each other's shares and not blindly expand their production.
Sikokakis: I think there is no winner in vicious competition. It is just a war of attrition. We believe that the decline in the second half of the year is about 40% compared with last year.
Gong Jianfei: low price competition destroys the Great Wall, gives play to the guiding role of the government and the industry, gives play to the advantages of the system, and makes products more specialized, refined, strong and new. The second half of the year is obviously better than the first half of the year, but the overall situation is still in the process of wandering at the low end.
Yang Hongjun: there are a lot of construction machinery stock assets. I hope that the industry association can reflect the situation to the Ministry of industry and information technology on whether it can add remanufacturing and recycling economy to the stock assets. I think the overall situation this year has dropped by about 30% - 40%.
Zhang Min: I think the second half of this year is slightly better than that of the same period last year. The growth rate of foreign countries is at least 50%, and that of domestic countries is at least 30% - 40%. Can the association advise national ministries and commissions to impose tariffs on products that realize domestic substitution for large-scale products.
Zhou Jun: I think the situation of industrial vehicles in the second half of China will be better than that in the first half, and the domestic growth will slow down.
Liu Changcheng: benign competition stimulates vitality, while vicious competition harms others and hurts oneself. It is suggested that the government and the industry actively guide. As for the situation in the second half of the year and the whole year, I think it will continue to decline.
