In August, the sales of heavy trucks and excavators decreased by 52% and 21% year-on-year. Despite the poor sales data of construction machinery, people in the industry expect that the most depressed moment in the industry is about to pass. With the accelerated issuance of special bonds, the sales data will improve as soon as September. In August, three acquisitions detonated the construction machinery industry! Let's look at the major events in the construction machinery industry in August.
Key words I: 2021 semi annual report
Outstanding performance of listed construction machinery enterprises
In August, the performance reports of enterprises in the construction machinery industry in the first half of 2021 were released one after another. The operating revenue, net profit and operating cash flow of most enterprises reached a record high. Under the background of the decline of industrial sales and the sharp rise of raw material costs in the second quarter, they still achieved high-quality growth.
2021 is the first year of the 14th five year plan. In the first half of the year, the national economy generally showed a trend of stable recovery and sustainable development. Thanks to the effective control of the domestic epidemic and the continuous release of macro policy effects, the construction machinery industry operated steadily in the first half of the year, and the sales of main products continued to grow steadily. With the gradual recovery of the world economy, the rigid demand for China's construction machinery in the international market is increasing, and the industry export is growing rapidly. In the first half of the year, the industry export hit a record high.
Among the domestic listed enterprises in the host industry, Sany Heavy industry won the "first in both revenue and net profit" in the first half of the year, and the net profit exceeded 10 billion yuan, reaching 10.074 billion yuan, ranking first among domestic enterprises. Among the supporting parts enterprises, Weichai Power led the business performance in the first half of the year, with a total revenue of more than 100 billion yuan, reaching 126.39 billion yuan. It is amazing that Weichai Power can achieve such a scale by virtue of power segmentation.
Among foreign brand listed enterprises, represented by caterpillar, Volvo Construction equipment, John Deere and JLG (jieerjie), the performance is also rising steadily. Among them, Caterpillar's operating revenue in the first half of the year was US $24.776 billion, a year-on-year increase of 20.09%, ranking first in the industry in the world.
From the perspective of the composition of operating revenue, the overseas operating revenue of many domestic enterprises has reached a new high. The overseas revenue of Sany Heavy Industry, XCMG machinery and Zoomlion has increased by 94.69%, 68.5% and 52.28% respectively year-on-year. In order to catch a glimpse of the leopard, the effectiveness of enterprise internationalization strategy is prominent. Chinese enterprises have taken solid steps in high-quality development and are shining brightly on the international stage.
In addition, from the growth of R & D investment of enterprises, it has become normal to pay attention to R & D and innovation. Taking XCMG machinery, Sany Heavy Industry and Weichai Power as examples, in the first half of 2021, the R & D expenses of these three companies were RMB 2.218 billion (a year-on-year increase of 64.43%), RMB 3.058 billion (a year-on-year increase of 80.82%) and RMB 4.63 billion (a year-on-year increase of 27.9%). With excellent technology, enterprises can have strong strength and enough confidence to be free from others at the critical moment. The continuous increase of R & D investment will inject new vitality into the growth of enterprise performance. Only by relying on innovation driven, can we make great progress and development.
Key words 2: export
China Construction Machinery likes to "go abroad"
Recently, a Chinese giant ship carrying nearly 1000 XCMG excavators, loaders and other construction machinery products was sent to South America and arrived at the port of destination in mid August. This is the largest single batch export order of China's construction machinery industry in recent five years, playing a loud and victorious song of the overseas rise of made in China.
According to the customs data, from January to June 2021, China's export of construction machinery reached US $15.071 billion, a year-on-year increase of 54.9%. In the first half of the year, the total export exceeded US $15 billion, an increase of 46.2% compared with the highest in history in the first half of 2019. Affected by the slowdown of the epidemic situation in the international market, economic recovery and other factors, there is a strong demand for construction machinery in the international market. In addition, the price rise of bulk commodities such as steel and coal drives mining, which further drives the demand for construction machinery. The plague of the epidemic has affected the supply chain in the international market. The rapid recovery of China's industrial chain and supply chain has made China more "needed" in the world import and export trade and become a major exporter of construction machinery products.
In addition, according to the website of the voice of Germany, in 2020, China surpassed Germany for the first time and became the champion of global mechanical equipment export. The total sales of mechanical equipment of 924 billion euros is almost equal to the sum of the United States, Germany, Japan and Italy. Behind China's becoming a "new export champion", it is the result of the effectiveness of the internationalization strategy of China's construction machinery enterprises. In the first half of 2021, XCMG's export increased by more than 70% year-on-year; Over the same period, Sany group's international sales revenue increased significantly by 80% year-on-year. Chinese construction machinery enterprises have entered the "World Finals track" with high quality and are upgrading "made in China" to "Chinese pride" step by step.
Key words 3: acquisition
Three acquisition cases concurrent
Can "1 + 1 > 2" be realized after reorganization
M & A has always been the focus of the market and the general trend of industry development. In August, several acquisition cases occurred in the industry: Hyundai Heavy Industry acquired Doosan construction machinery with 850 billion won, Danfoss officially completed the acquisition of Eaton's hydraulic business with us $3.3 billion, and Lee brothers acquired European auctions.
Danfoss officially completed the acquisition of Eaton's hydraulic business
On August 3, Danfoss officially completed the acquisition of Eaton hydraulic business with us $3.3 billion. This acquisition will double the scale of Danfoss hydraulic business, expand the business scale of Danfoss group by one third, and become a global leader in the field of mobile and industrial hydraulic.
Acquisition of Euro auctions by lees brothers
On August 9, lees Brothers announced that it had reached an acquisition agreement with euro auctions (European auction company) and would complete the acquisition of Euro auctions in the first quarter of 2022. The two companies have more than 88 years of industry experience. This cooperation will provide customers with services in a more powerful way!
Mian Wujia, chairman of Hyundai Heavy Industry Holdings, and his delegation visited Doosan construction machinery
On August 20, Hyundai Heavy Industry officially acquired Doosan construction machinery, which is undoubtedly a major focus in the host enterprise circle. In the future, the two brands will jointly become the top participants in the global construction equipment market and strive for the goal of modern heavy industry to squeeze into the top five in the world. So, how far is modern heavy industry from the goal of the top five in the world?
According to the 2021 yellow table, Hyundai Heavy industry ranks 21st with sales of US $2.345 billion, and Doosan construction machinery ranks 10th with sales of US $7.109 billion. If you simply add up the sales, it slightly exceeds Zoomlion (US $9.449 billion), which is now ranked fifth. In short, Hyundai Heavy Industry is expected to reach the first Korean brand and the fifth in the world. Whether it can achieve its goal depends on how strong the "chemical reaction" effect after Hyundai's acquisition of Doushan and the growth of other brands.
Proactive fiscal policy emphasizes sustainability
The 2021 government work report pointed out that the proactive fiscal policy should improve quality, efficiency and sustainability. Considering the effective control of the epidemic and the gradual recovery of the economy, the deficit ratio this year is planned to be about 3.2%, lower than last year, and no special anti epidemic treasury bonds will be issued. Due to the restorative growth of fiscal revenue, the total scale of fiscal expenditure increased compared with last year. The focus is still to increase support for market players to ensure employment and people's livelihood. The positive fiscal policy has changed from "more active and promising" in 2020 to "improving quality, efficiency and sustainability", which shows that finance has gradually withdrawn from the "emergency" state and coordinated economic development with the sustainability of fiscal revenue and expenditure.
Under the urban construction environment, the infrastructure construction and the transformation of old residential areas will further drive the demand for small construction machinery. Considering the rising labor cost, the replacement of machines under specific construction environment will have a high cost performance ratio, and the proportion of small and medium-sized construction machinery in the sales of construction machinery will continue to increase in the future. With the continuous implementation of local infrastructure investment projects, it is expected that the prosperity of construction machinery will remain at a high level in 2021. Infrastructure and real estate policies accelerate the demand for construction machinery. Although China's construction machinery industry has entered the stock market, the cumulative growth rate of new construction area of real estate and the growth rate of infrastructure investment can still better fit the new demand level of construction machinery, reflecting the prosperity of construction machinery industry to a certain extent.
In addition, looking at China, a huge market that "strategists must compete for", this acquisition will also stir up the brand competition pattern in the Chinese market. According to the market share distribution of excavator brands in 2020, after the merger of Hyundai and Doosan's share in China's excavator market, it is possible to become the second largest foreign brand after caterpillar and the top five in China's market.
Whether in the increasingly competitive international market or the Chinese market where the living space of foreign brands is constantly eroded, Hyundai and Doosan Korean brands hold together for warmth. In the collision with strong rising Chinese brands and old international giants, they can consolidate their position by complementing their advantages in technology, production, procurement and sales and integrating advantageous business resources, Gain greater competitive advantage. It remains to be seen whether modern heavy industry can ascend the throne of the top five in the world.
