According to the latest statistics from the China Construction Machinery Industry Association, the 25 excavator manufacturers included in the statistics in June 2020 sold a total of 24,625 excavators of various types, a year-on-year increase of 62.9%. From January to June 2020, 170,425 excavators were sold, a year-on-year increase of 24.2%.
From the historical sales data of excavators, the sales of excavators in the first half of the year accounted for about 60% of the sales of excavators in the whole year. Taking into account the delay in the start of some new major projects after the "Two Sessions" this year, it is expected that the sales of excavators in the first half of this year will account for 55%-60%. From January to June of 2020, the sales volume of excavators is about 170,000 units. It is estimated that the sales volume of excavators in 2020 will be 280-31 million units, a year-on-year increase of 19%-31%.
From the above point of view, it can be seen that major research institutions are still optimistic about excavator sales in July. Among them, three institutions clearly predict that the sales of excavators in July will increase by more than 50% or even 60% year-on-year; there are 5 The agency predicts that the sales volume of excavators in 2020 is expected to exceed 280,000 units or even reach 300,000 units, with a year-on-year growth rate of 20%-30%.
Judging from the reasons why major institutions hold the above-mentioned optimistic forecast views, there are mainly the following two points:
First, real estate and infrastructure investment in the second half of 2020 will not be pessimistic. Real estate investment is divided into several expenditures such as land purchase, construction and installation, and tool purchase, but the investment index directly related to the excavator is construction and installation engineering expenditure. The expenditure on construction and installation projects from January to May of 2020 was 2786.29 billion yuan, which has basically returned to the level of the same period last year, reflecting the current overall resilience of my country's real estate market.
Infrastructure includes electricity and gas, transportation and storage, water conservancy environment, and public facility management, but the projects that are really related to excavator earthwork are mainly: railway transportation, road transportation, water management, and ecological protection and environmental management. From January to June 2020, the year-on-year growth rate of the railway transportation industry, road transportation industry, water conservancy management industry, ecological protection and environmental treatment industry all turned positive.
As of mid-July, the 3.75 trillion yuan of new local government special bonds approved by the National People's Congress had issued 2.24 trillion yuan and spent 1.9 trillion yuan, of which more than 80% of the special bonds were invested in the three major areas of transportation infrastructure. As of mid-July, there were about 1.5 trillion yuan of special bonds to be issued. The State Council urged local governments to speed up the issuance of bonds to support the “two new projects and one heavy industry” and the construction of public health facilities, which will help drive the growth of infrastructure investment in the second half of the year.
The second is that environmental protection upgrades drive industry replacement demand. Although the current National IV emission standards for non-road mobile machinery such as excavators may be postponed, the country has been accelerating the pace of environmental protection upgrades for non-road mobile machinery. Environmental protection upgrades will facilitate the elimination and replacement of old models of excavators, thereby providing additional demand for construction machinery. At present, there are about 1.5 million excavators in the market, and more than 500,000 units of China's second and lower equipment. With the increase in emission standards under environmental protection requirements, the demand for replacement is expected to inject additional driving force into the sales of new machines for construction machinery companies.
In summary, the real estate and infrastructure investment performance in the second half of this year is not pessimistic. The current construction machinery industry is still in this round of renewal cycle. Coupled with environmental protection upgrades to stimulate industry replacement demand, it is initially expected that excavator sales in 2020 are expected to exceed 300,000 units.
