The arrival of the peak season for infrastructure construction has promoted the growth of excavator sales. The latest data released by the China Construction Machinery Industry Association shows that in September 2020, China sold a total of 26,034 sets of excavation machinery products, an increase of 64.8% year-on-year. This is the six consecutive months since April this year that excavator sales have maintained a year-on-year growth rate of more than 50%.
????The data also shows that the 25 mainframe manufacturers included in the statistics from January to September 2020 have sold a total of 236,508 units of various excavation machinery products, a year-on-year increase of 32%. Among them, the domestic market sales volume was 212,820 units, a year-on-year increase of 33.2%; the export sales volume was 23,688 units, a year-on-year increase of 22.2%.
????Excavator is one of the main types of construction machinery widely used in various large and small earth and stone works. It is also one of the most sensitive types of machinery to downstream demand changes, and is closely related to the macroeconomic cycle. Industry analysts believe that sales of excavators continued to grow in September, which is inseparable from the intensive availability of major projects in various regions.
Chen Li, chief economist and research institute director of Chuancai Securities, said in an interview with a reporter from Securities Daily that there are three main reasons for the increase in excavator sales: first, the real estate market drives demand: due to the impact of the epidemic, the second The total real estate investment in the first quarter declined, but the medium- and long-term demand remained strong. Under the normal situation of epidemic prevention and control, real estate companies started intensively, stimulating the demand for excavators. In the medium and long term, strategic planning such as shantytown transformation, continued urbanization, and the further development of urban agglomerations will continue to be an important support for driving demand in the future.
????Second, infrastructure investment has accelerated. Since the beginning of this year, local special bonds have been large in scale and issued quickly. On July 29, the Ministry of Finance issued a document calling for speeding up the issuance and use of local government special bonds. It can be seen that the scale of local government bond issuance in August was nearly 1.2 trillion yuan. The acceleration of the issuance of local special bonds will promote infrastructure investment, which in turn will drive demand for excavators. At the same time, after the high temperature and rainy season in July and August, delayed engineering projects will also begin to accelerate, which will further stimulate demand for excavators. Therefore, the sales of excavators in September showed a further growth trend.
???? Third, the new infrastructure will drive the old infrastructure. At present, all parts of the country have begun to formulate large-scale new infrastructure investment plans. However, new infrastructure is also inseparable from the supporting facilities of the old infrastructure. In the context of accelerated investment in new infrastructure, related supporting facilities such as: industrial park construction, base station laying, water conservancy projects, etc. Play a pulling role in the excavator market. Therefore, it can also be seen that among the excavators, small and medium digging is the main growth force. Large digging is relatively slower, because in the construction of new infrastructure and the “two new and one heavy” construction of small and medium transportation and water conservancy major projects, small and medium digging Digging plays a more important role.
???? Pacific Securities chief investment consultant Zhao Huan told the “Securities Daily” reporter that excavators, as a weather vane of the machinery industry and a barometer of the economy, have attracted market attention. The continuous growth of sales has conveyed a positive signal that the domestic economy is continuously and rapidly recovering. The domestic resumption of work and production, infrastructure, and real estate are the main reasons for the continuous growth of construction machinery sales.
????The increase in sales of excavators has also been reflected in the performance of related listed companies. For example, Sany Heavy Industry's semi-annual report shows that in the first half of 2020, excavation machinery sales revenue was 18.649 billion yuan, a year-on-year increase of 17.22%. The domestic market has won the sales champion for the 10th consecutive year, and its market share continues to increase.
???? “It is expected that as the construction of the'two new and one high' projects continues in the fourth quarter, a number of major projects will be implemented one after another. The construction machinery industry will continue to maintain a high boom and the growth momentum is expected to continue.” Zhao Huan said.
???? Soochow Securities Chen Xianfan believes that looking forward to the fourth quarter, the “National Fourth” regulations will be switched at the end of the year, overseas exports will gradually pick up, the financing environment will improve and the growth rate of infrastructure and real estate investment will increase. The peak season will shift back under the influence of the epidemic. The overall demand for construction machinery is expected to remain strong. In October, the oil cylinder production schedule of core parts manufacturers increased by 40% year-on-year, and the high growth in excavator sales is expected to continue.
????Zheshang Securities Wang Huajun believes that real estate infrastructure investment continues to recover, and the demand for artificial replacement, environmental protection and replacement, the high boom of excavators is expected to continue. It is expected that the sales of excavators in 2020 will exceed 310,000 units, a year-on-year increase of over 30%.
