China construction machinery industry analysis - industry overall situation

Under the influence of global economic growth continues to slow down, serious regional differentiation, real estate market risk backlog and other factors, the development of construction machinery industry is facing greater pressure. In addition, the improvement of environmental protection requirements, the development of digital intelligence and low-carbon, has brought higher technical challenges to the construction machinery industry. In this context, there is a certain imbalance in the development prospects of construction machinery industry in China and overseas key markets.

1. Rising interest rates in the United States may prompt contractors to turn to equipment leasing, leading to greater uncertainty in the construction machinery industry.

2. India benefits from the development and growth of the construction and mining industries, and the construction machinery industry will usher in a period of demand growth.

3. Global economic growth continues to slow down, regional differentiation is serious, and the development of overseas markets in the construction machinery industry is unbalanced.

4. The global real estate sector has a backlog of risks, and the long-term slowdown in growth has increased the pressure on the construction machinery industry.

5. Global environmental awareness, digital intelligence and low carbonization are widely used, and the construction machinery industry is facing technical challenges. Overall situation of construction machinery industry:

(1) Sales of China's construction machinery industry

From the perspective of product sales structure, in 2023, China's total sales of construction machinery products 601,151 units, mainly lifting work platforms, excavators and loaders, in 2023, the three categories of sales accounted for 34%, 33% and 17%, accounting for 84%. Among them, excavator sales accounted for about 1/3, consistent with the global overall situation. According to statistics, the total sales of the top 50 global construction machinery manufacturers in 2023 are 223.806 billion US dollars, of which the excavator business ranks the top 20 enterprises, the total sales of the excavator sector is 65.047 billion US dollars, accounting for 29.06% of the total sales of the top 50 global construction machinery manufacturers, nearly one third.

According to the statistics of the China Construction Machinery Industry Association, in 2023, in the 11 construction machinery categories included in the statistics, only truck cranes, aerial work vehicles and lifting work platforms achieved positive sales growth, an increase of 37.4%, 23.4% and 5.3%, respectively. The remaining 8 categories of 2023 annual sales of different degrees of decline, of which the decline is larger are excavators, pavers, loaders and tower cranes, respectively, down 25.4%, 18%, 15.8% and 13.1%.

(2) Sales in key countries

United States: The Census Bureau data of the US Department of Commerce show that in November 2023, the US construction machinery shipments were 4.473 billion US dollars, an increase of 9.04%, and the increase was 2.16 percentage points lower than the previous month; The inventory amount was 9.817 billion US dollars, an increase of 8.72%, the growth rate decreased by 2.18 percentage points compared with the previous month; New orders amounted to US $4.438 billion, an increase of 9.58%, an increase of 3.93 percentage points over the previous month; Unfilled orders amounted to $10.302 billion, down 12.8% year on year and 0.1 percentage points lower than the previous month. From January to November 2023, the shipment of construction machinery in the United States was $44.935 billion, an increase of 5.56%; Inventory value of 101.416 billion US dollars, an increase of 3.26%; New orders amounted to US $44.993 billion, up 2.52% year on year; The backlog was $144.608 billion, down 18.09% year on year. The American Association of Construction Equipment Manufacturers (AEM) expects that in 2024, the demand for U.S. construction projects in the industrial, infrastructure and energy fields may improve, but rising interest rates may prompt contractors to turn to equipment leasing, so the U.S. construction machinery industry is still facing greater uncertainty.

Japan: In November 2023, the total amount of Japanese construction machinery shipments was 322.424 billion yen, an increase of 0.8%, and the growth rate was significantly reduced by 8.4 percentage points from the previous month. Among them, the domestic shipment amount of 101.178 billion yen, an increase of 4.1%, decreased by 10.6 percentage points compared with the previous month; Foreign shipments amounted to 221.246 billion yen, down 0.6% year-on-year. From January to November 2023, the total volume of Japanese construction machinery shipments was 3,451.855 billion yen, an increase of 14.83%. Among them, the domestic shipment amount was 1,031.095 billion yen, an increase of 9.64%; Foreign shipments amounted to 2,420.76 billion yen, an increase of 17.2%.

India: According to the statistics of the Indian Construction Equipment Manufacturers Association (ICEMA), the sales volume of construction machinery and equipment in India in the first quarter of the fiscal year 2023-2024 increased by 18% year-on-year, reaching 27,244 units; Equipment sales in the second quarter increased by 31% year-on-year to 30,078 units, of which earthmoving machinery increased by 23% and pavement machinery increased by 65%. Infrastructure construction is the main driving force for the growth of the construction machinery market. Thanks to the development and growth of the construction and mining industry, India's construction machinery industry will usher in a period of demand growth, the Indian industry analysis that the 2022-2023 fiscal year, India's construction machinery sales for the first time exceeded the 100,000 units mark, is expected to grow by 12 to 15% in the 2023-2024 fiscal year, with total sales of more than $6 billion.

Brazil: According to the Brazilian Construction and Mining Technology Association (SOBRATMA) statistics forecast that in 2023, Brazil mining card sales increased by 117%, roller sales increased by 69%, small loader sales increased by 15%, small excavator sales increased by 2%; Loader sales fell 30%, hydraulic excavator sales fell 41%, backhoe excavator sales fell 13%, and other product sales fell about 6%. SOBRATMA predicts that construction machinery sales in Brazil will fall by 13% year-on-year to 52,400 units in 2023. The main reasons for the decline in Brazil's construction machinery industry, first, Brazil's construction machinery and equipment sales in 2022 hit a record high, and the high base led to negative growth in the industry in 2023; Second, adverse factors such as rising interest rates, declining infrastructure construction, and reduced investment budgets in the construction industry have led to insufficient momentum for the development of Brazil's construction machinery industry