China's Construction Machinery Technological Innovation Helps To Carry 'the Belt And Road' Ride

- Dec 10, 2020-

China's construction machinery technological innovation helps to carry the "Belt and Road" ride

The efficiency of the construction machinery industry has been sluggish for four years, and overcapacity and insufficient market demand still exist. The production capacity of China's loaders is approximately 420,000 units per year, compared with 167,000 units sold last year. Similarly, the excavator market is not optimistic. Even if all the excavators are supplied by China, there is still an excess capacity of 120,000 units.

   In this market environment, the "One Belt One Road" strategy has played a timely role in promoting the construction of domestic projects and countries along the routes. In the process of building roads and railways, the construction machinery products that are in high demand are excavators, loaders, and bulldozers, and these machines have a wide range of applications, so the output of construction machinery as an infrastructure tool will fully benefit.

  Technological innovation helps carry the "Belt and Road" ride

  Data show that the export value of China's construction machinery increased by 53.8 in 2012, and fell by 18.1 in 2013, and continued to decline year-on-year last year. Although the export volume is declining, the share of Chinese construction machinery in major overseas markets has continued to rise. For example, the proportion of construction machinery imported by the United States from China increased from 10.08 in 2012 to 12.02, the Asian market increased from 43 to 47, and the African market Increase from 12 to 15.

   However, research has found that companies with relatively strong innovation capabilities in the industry have particularly outstanding export performance. Therefore, overcapacity is relative, and there will be no overcapacity to make competitive products and companies.

   At this stage, the implementation of the "One Belt One Road" strategy has opened up a good opportunity for the construction machinery industry to open up the international market. Only when construction machinery companies actively maintain their overseas distribution networks, consolidate their achievements in expanding overseas markets, and strengthen technological innovation and product upgrades, can they strive to be equipped with the "Belt and Road" project and win a turnaround.

   The advantages of "going out" are obvious and still need government support

   In the process of "going out", there is still a lack of effective and standardized institutional constraints. Some companies are keen on price competition, bargaining prices with each other, which is rather chaotic. Some companies are shoddy, which affects the image of Chinese brands...All these require the government and industry associations to coordinate, formulate corresponding rules and regulations, monitor and adjust the product prices of domestic export companies, and prevent mutual price reduction and disrupt market order. The phenomenon, and effectively enhance the international influence of the entire Chinese engineering equipment industry.

   Some people in the industry said that the construction machinery industry further "goes out" and expands the international market, but also needs government support from various aspects such as policy and finance.

   One is that local governments should pay attention to it. Help promote the promotion of construction machinery products, just like the promotion of high-speed rail, help enterprises to open up overseas markets.

   The second is that the financial industry should support the construction machinery industry to "go global." Further give play to the role of commercial banks, CITIC Insurance, etc., strengthen support for corporate financing, reduce financing costs, introduce more and more flexible financing policies, reduce financing risks, and facilitate companies to more efficiently obtain capital and acceptance guarantee support overseas. It is more convenient for users to finance the purchase of domestically produced machines.

   The third is to help the industry resolve overcapacity in tax, interest, debt, and other aspects. The overseas transfer of production capacity provides policy support and financial support for transportation, customs, commodity inspection, and taxation.

  Fourthly, large central enterprises, construction units, and other Chinese enterprises try their best to use "Made in China" construction machinery products when constructing overseas. They must bring Chinese equipment abroad to further increase their support for the construction machinery industry.

In addition, relevant persons of the China Construction Machinery Industry Association also put forward several suggestions for the construction machinery industry to "go global", including giving key support to outstanding enterprises "going global"; increasing international talent training and subsidy support for key international exhibitions in the industry In key export areas, countries or associations will take the lead to establish construction machinery industrial parks, professional brand export alliances, etc.; support and help industry organizations to strengthen export product standards and certification, accelerate international cooperation in certification, and strive for more international voice.

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