Statistics from the Excavation Machinery Branch of the China Construction Machinery Industry Association show that in January-February 2020, China's domestic sales of excavators fell 46.5% year-on-year; however, the market quickly stopped falling in March, and sales in March increased 11.2% year-on-year. Monthly continuous high growth, the year-on-year growth in April and May reached 64.5% and 76.3% respectively, and the year-on-year growth in January-May reached 19.3%.
"It is expected that in the first half of 2020, China's domestic sales of excavators will hit a record high." Huang Min, chairman of the China Construction Machinery Industry Association Excavation Machinery Branch, made such a judgment.
Overseas plunge & China's exports now worries
The global market outside of China is not too good.
"Affected by the epidemic situation, plus the European, American and Japanese construction machinery industry has entered the industry cycle decline range, the global excavator demand except China from January to April 2020, fell by 13.4%. In addition, the current situation of overseas epidemic situation is still uncertain, 2020 The global excavator market is likely to decline sharply in 2016. Even after the epidemic is contained, due to the limited growth momentum and space for infrastructure investment overseas, especially in developed regions, the market is unlikely to experience a retaliatory rise." Huang Min said.
Affected by the bleak global market, the fast-growing export market has also shown signs of slowing down in the past two years. In 2019, China's excavator exports increased by 39% year-on-year, and in January and February 2020, the market maintained a rapid growth attitude, with year-on-year increases of 35.3% and 62.5%, respectively. However, with the outbreak of the global epidemic in March, the export market growth rate continued to decline. The year-on-year increase in March fell to 17.7%, and the year-on-year increase in April and May fell to 0.9% and 3.3%. The cumulative export sales growth rate from January to May also fell to 20.7%.
Data show that from January to April 2020, the export of Chinese brand excavators increased by 17.7% year-on-year, of which exports in mature markets in Europe and America increased by 26% year-on-year, and exports in emerging markets increased by 21% year-on-year. "Overall, it is expected that China's export sales of excavators in 2020 are likely to be the same as 2019." Huang Min predicted.
Global change
The polarization in the development of the Chinese and foreign excavator markets is bringing about major changes in the global excavator industry.
In fact, changes have long been traced.
First of all, in the world's largest excavator market-China, the division of "cake" has changed. Over the past 10 years, Chinese excavator companies have relied on 3-4 generation product upgrades and technology-related accumulation to increase their market share from less than 30% in 2010 to about 70% today. Conversely, foreign brands that have dominated the Chinese excavator market for a long time, apart from Caterpillar, Komatsu, Hitachi, Doosan, Volvo, Hyundai, etc., still have considerable shares, other companies have already declined in China. What is more and more certain is that in the Chinese excavator market, a new camp represented by local companies is taking shape.
Outside of China, shrinking global market demand, especially in Europe, America and Japan, has also brought considerable pressure on foreign brands. Beginning in the fourth quarter of 2019, the performance of European, American and Japanese construction machinery manufacturers has declined significantly. In the first quarter of 2020, according to public information, the epidemic intensified this trend-Caterpillar, the world's largest construction machinery manufacturer, construction machinery business fell 21% year-on-year, and mining machinery business fell 24% year-on-year.
Changes in the scale of Chinese and multinational excavator manufacturers have caused another round of shuffling in the global "excavator" industry "ranking". The new industry pattern is accelerating.
Chinese market, scale wins
The Chinese excavator market believes in technology and products, but more in scale; after all, in the entire construction machinery industry, the excavator itself is a scale-oriented segment, and only the advantages of products, technology and other aspects can be converted into real ones. Only scale can in turn promote further technological iteration, product upgrades and cost control of the enterprise, so that the development of the enterprise enters a virtuous circle. Without scale, it is impossible to grow bigger, and it is impossible to grow stronger.
Looking back at the development of China's excavator industry in the past decade, only those companies that have formed a moat of scale and are strenuous in terms of products, technology and other indicators have successfully reached today and still maintain the lead; otherwise, they only have products Advantages, brand advantages, and companies with no real share in the circle can hardly be said to be the final harvest of the Chinese excavator market. "As the competition is further fierce, the market concentration of the Chinese excavator industry will be higher in the future, and the oligarch effect will be more prominent." Huang Min is convinced of this.
