The construction machinery industry is gradually recovering

Release date 2024-11-24 13:41:07 Reading 4

　　The construction machinery industry is gradually recovering, and the domestic sales of excavators have been increasing year-on-year for 8 consecutive months

　　As a barometer of the construction machinery industry, domestic sales of excavators have achieved positive year-on-year growth for eight consecutive months, with domestic sales in October increasing by over 20% year-on-year.used excavator used excavator used excavator used excavator

　　According to data from the China Construction Machinery Industry Association, in October 2024, major excavator manufacturers sold a total of 16791 excavators of various types, a year-on-year increase of 15.1%. Among them, the domestic sales volume was 8266 units, a year-on-year increase of 21.6%; The export volume was 8525 units, a year-on-year increase of 9.46%. Sell 10 electric excavators (5 in the 10 to 18.5 ton range, 4 in the 18.5 to 28.5 ton range, and 1 above 40 ton range).

　　From January to October 2024, major excavator manufacturers sold a total of 164172 excavators, a year-on-year increase of 0.47%; Among them, the domestic sales volume was 82211 units, a year-on-year increase of 9.8%; 81961 units were exported, a year-on-year decrease of 7.41%.used excavator used excavator

　　During the same period, the sales of loaders also achieved sustained growth, especially in terms of exports and sales of electric loaders.used excavator

　　According to data from the China Construction Machinery Industry Association, in October 2024, major loader manufacturers sold 8355 units of various types of loaders, a year-on-year increase of 11.1%. Among them, the domestic sales volume was 4032 units, a year-on-year decrease of 7.08%; The export volume was 4323 units, a year-on-year increase of 36%. Sales of 1038 electric loaders (15 units of 3 tons, 811 units of 5 tons, 197 units of 6 tons, and 15 units of 7 tons).used excavator

　　From January to October 2024, major loader manufacturers sold a total of 90153 loaders of various types, a year-on-year increase of 5.29%. Among them, the domestic sales volume was 45442 units, a year-on-year decrease of 0.68%; The export volume was 44711 units, a year-on-year increase of 12.1%.

　　In addition, the construction machinery operating rate, which reflects the heat of engineering construction, is also on the rise.used excavator used excavator

　　According to data from the China Construction Machinery Industry Association, in October 2024, the monthly operating rate of the main products of construction machinery was 65.1%, an increase of 1.31% compared to the previous month. The monthly operating rate of excavators is 70%; The monthly operating rate of the loader is 63.9%; The monthly operating rate of automobile cranes is 80.1%; The monthly operating rate of crawler cranes is 63.5%.used excavator used excavator

　　China Galaxy Securities stated that from the perspective of cyclical fluctuations, the excavator market has entered a downward cycle since 2022, and it is expected that 2024 will be the year when the domestic market bottoms out. Coupled with large-scale equipment renewal policies, a new round of renewal and replacement cycles is expected to gradually begin in 2025.used excavator used excavator

　　The gradual recovery of the construction machinery industry is also driving the recovery and growth of corporate profits. In the first three quarters of this year, the three major leaders in construction machinery continued their growth trend from the first half of the year, with net profits all maintaining positive growth. Among them, Sany Heavy Industry (600031) achieved a revenue of 57.891 billion yuan, a year-on-year increase of 4.22%, and a net profit of 4.868 billion yuan, a year-on-year increase of 19.66%; XCMG Machinery (000425) achieved a revenue of 68.726 billion yuan, a year-on-year decrease of 4.11%, and a net profit of 5.309 billion yuan, a year-on-year increase of 9.71%; Zoomlion (000157) achieved a revenue of 34.386 billion yuan, a year-on-year decrease of 3.18%, and a net profit of 3.139 billion yuan, a year-on-year increase of 9.95%.used excavator used excavator used excavator used excavator used excavator

　　It is worth noting that Lan Fo'an, Minister of Finance, introduced at the press conference of the 12th meeting of the Standing Committee of the 14th National People's Congress held on November 8 that, starting from 2024, China will allocate 800 billion yuan of new local government special bonds every year for five consecutive years, which will be used exclusively for debt conversion, with an accumulated replaceable implicit debt of 4 trillion yuan. Add in the 6 trillion yuan debt limit approved by the Standing Committee of the National People's Congress this time, and directly increase the local debt resources by 10 trillion yuan. At the same time, it is also clear that the implicit debt of 2 trillion yuan for shantytown renovation due in 2029 and beyond will still be repaid according to the original contract. With policy support, the pressure of local government debt has been greatly reduced.used excavator used excavator used excavator used excavator used excavator

　　Multiple industry analysis agencies have stated that the simultaneous issuance of localized bonds will further boost demand for construction machinery and equipment.

　　Pacific Securities stated in a research report that it is expected that with the gradual implementation of the debt policy, it will be beneficial for the repayment of construction machinery projects, improve project capital turnover, drive the growth of physical workload, and increase the operating rate, thereby driving the demand for construction machinery equipment. Combined with the large-scale equipment trade in policy and the continued favorable real estate policy, it is optimistic that the demand for construction machinery equipment will continue to improve.used excavator used excavator used excavator

　　Guolian Securities also said that in 2024, under the background of trillions of treasury bond promoting the landing of infrastructure investment, the bottom of the domestic market will recover weakly; At the same time, the introduction of various fiscal and economic stimulus policies such as the US infrastructure bill of about $1.2 trillion is expected to support the demand of the overseas construction machinery market. With the continuous deepening and expansion of the "the Belt and Road" initiative, and the acceleration of the replacement of European and American brands by Chinese brands in the Russian speaking region, there is still room for growth in the overseas market.used excavator used excavator used excavator used excavator

　　The agency also stated that the rebound in domestic sales of excavators has spread to the "non excavator" product line. In the fourth quarter of 2024, the construction machinery sector is still expected to achieve good performance, and the signal of improved demand for excavators and other products in the domestic market is quite obvious.used excavator used excavator used excavator used excavator

　　Three major benefits boost the cyclical recovery of construction machineryused excavator used excavator used excavator

　　The export growth rate of construction machinery such as excavators and loaders has turned positive, and domestic market sales have steadily rebounded. The construction machinery industry, which has experienced three years of decline, is gradually recovering; Looking back, the last economic cycle of the construction machinery industry began in 2016. With the combined support of periodic equipment updates, electrification, and internationalization, the construction machinery market is expected to continue to recover.used excavator used excavator used excavator

　　Wang Dongyue/Wenused excavator used excavator used excavator used excavator

　　Recently, the latest data released by the China Construction Machinery Industry Association showed that in August 2024, major excavator manufacturers in China sold a total of 14700 units of various types of excavators, with a year-on-year increase of 11.8% in sales volume. Among them, the sales volume of excavators in China in August was 6694 units, a year-on-year increase of 18.1%; The export sales volume was 7953 units, a year-on-year increase of 6.95%, officially ending the 14 consecutive months of negative year-on-year growth in export sales.

　　Since March, with the joint assistance of factors such as the increase in downstream infrastructure growth and the improvement of equipment replacement demand, sales data of construction machinery represented by excavators have continued to release positive signals. Multiple securities firms have analyzed that after three years of continuous decline, construction machinery has gradually entered the bottom range, and industry listed companies are looking forward to a return to the business cycle.

　　Excavator export growth rate turns positiveused excavator used excavator used excavator used excavator used excavator

　　According to statistics from the China Construction Machinery Industry Association, the sales volume of domestic excavators increased by 11.8% year-on-year in August, with a growth rate of 3.2 percentage points higher than the previous month, achieving positive year-on-year growth for the fifth consecutive month. Among them, domestic excavator sales increased by 18.1% year-on-year, exceeding the previous forecast of 17% year-on-year growth by the Construction Machinery Magazine (CME), achieving six consecutive months of positive year-on-year growth; During the same period, the export sales of excavators reached 7953 units, a year-on-year increase of 6.95%, achieving the first positive year-on-year growth rate since June 2023. From January to August, major excavator manufacturers sold a total of 131600 excavators, a year-on-year decrease of 2.2%, and the year-on-year decline continued to narrow.used excavator used excavator used excavator used excavator used excavator

　　Meanwhile, in August, the sales growth rate of loaders further expanded. According to statistics from the China Construction Machinery Industry Association, sales of domestically produced loaders reached 8329 units in August, a year-on-year increase of 15.2%. Among them, the sales volume in the domestic market was 4036 units, a year-on-year increase of 8.99%; The export sales volume was 4293 units, a year-on-year increase of 21.8%. From January to August, the cumulative sales of loaders reached 73700 units, a year-on-year increase of 4.7%. Among them, the sales volume in the domestic market was 37400 units, a year-on-year increase of 0.57%, and the sales growth rate officially turned negative to positive; The export sales of loaders reached 36300 units, a year-on-year increase of 9.33%.used excavator used excavator

　　Benefiting from the improvement of downstream infrastructure demand and the continuous implementation of equipment replacement support policies, the sales growth rate of domestic excavators has been the first to turn positive and the growth rate continues to expand since March. By May, the scope of recovery for construction machinery had further expanded to include loaders, and domestic sales data had turned positive year-on-year.used excavator used excavator

　　In the first half of the year, the overall revenue and net profit scale of A-share construction machinery listed companies have both increased. According to data from Dongchai Choice, in the first half of the year, 33 A-share listed construction machinery companies achieved a total operating revenue of 185.507 billion yuan, an increase of 1.675 billion yuan from the same period last year, a year-on-year increase of 0.91%; The total net profit attributable to the parent company was 16.684 billion yuan, a year-on-year increase of 6.89%; The total net cash flow from operating activities was RMB 15.518 billion, a significant increase of RMB 10.328 billion compared to the same period last year, with a year-on-year growth of 198.99%.used excavator used excavator used excavator used excavator used excavator

　　In terms of revenue and profit scale, in the first half of the year, XCMG Machinery, Sany Heavy Industry, and Zoomlion Heavy Industry achieved operating revenues of 49.632 billion yuan, 39.06 billion yuan, and 24.535 billion yuan, respectively, with net profits attributable to shareholders of 3.706 billion yuan, 3.573 billion yuan, and 2.288 billion yuan, ranking among the top three in terms of revenue and net profits attributable to shareholders; In terms of revenue growth rate, in the first half of the year, Shantui Group, Zhejiang Dingli, and Aidi Precision ranked among the top three with revenue growth rates of 33.81%, 24.56%, and 21.12%, respectively; During the same period, LiuGong, Shantui Group, and Hangcha Group ranked among the top three in terms of net profit growth rate with 60.2%, 38.49%, and 29.29%, respectively.

　　Domestic sales experience cyclical recoveryused excavator used excavator used excavator used excavator

　　During a recent investor survey, XCMG Machinery revealed that there have been some positive signs in the domestic sales of the industry, especially in the continuous months of conversion of earth and stone machinery, and the construction machinery industry is gradually entering a new cycle of upward trend.

　　From the perspective of sales proportion, excavators have the highest sales proportion in the construction machinery industry, therefore, their cyclical changes can reflect the development trend of the entire construction machinery industry.used excavator used excavator used excavator used excavator used excavator

　　Statistics show that the excavator industry has gone through two cycles since 2006. Among them, from May 2011 to April 2016, due to the weak global economic recovery, the cooling of domestic infrastructure construction and real estate investment, and other factors, the construction machinery industry faced a stage of overcapacity and entered the clearance stage. During this period, the overall sales of excavators decreased from 167500 units in 2011 to 70300 units in 2016, a cumulative decrease of 58.03% over a period of five years.used excavator used excavator used excavator used excavator

　　In 2017, with the vigorous promotion of the "the Belt and Road" initiative and the construction of new urbanization, the growth of infrastructure investment accelerated significantly; At the same time, the existing equipment has also entered the update cycle, coupled with the accelerating trend of machine substitution, the domestic construction machinery industry has ushered in a five-year recovery growth, and the industry's prosperity continues to improve. In 2020, domestic excavator sales reached a historic high of 327600 units, an increase of about 3.66 times compared to 2016.used excavator used excavator used excavator used excavator

　　In the second half of 2021, the construction machinery industry once again entered a downward cycle, with overall domestic sales weakening. As of 2023, the construction machinery industry has experienced a downward cycle of nearly three years, with excavator sales dropping from approximately 342800 units in 2021 to 195000 units in 2023, a decrease of approximately 43.16% over a three-year period.used excavator used excavator used excavator used excavator

　　According to statistical data, as of the end of 2023, the 8-year ownership of excavators in China is about 1.7 million units, and the 10-year ownership is about 1.9 million units. According to the statistics of the Construction Machinery Association, construction machinery has obvious strong cyclic properties, and the service life of construction machinery equipment is usually about 8 years. Based on the previous sales low point, construction machinery equipment is gradually entering a new round of replacement period, and the potential demand for stock updates needs to be released.used excavator used excavator used excavator used excavator

　　Guolian Securities stated that currently, the reduction rate of the construction machinery industry is basically close to the decline rate of the previous cycle, and the domestic sales of construction machinery may have entered the bottom zone and are in the bottom building stage. Looking ahead, equipment updates and infrastructure investments are expected to initiate a new upward cycle. Among them, infrastructure investment, especially water conservancy investment, is expected to become the main supporting force.used excavator used excavator used excavator

　　According to data from the National Bureau of Statistics, in the first half of 2024, the total investment in real estate development in China was approximately 5.25 trillion yuan, a year-on-year decrease of about 10.1%. In contrast, the growth rate of domestic infrastructure investment is relatively stable. From January to June, the cumulative investment amount of basic investment was about 8.4 trillion yuan, a year-on-year increase of about 5.4%. Among them, water conservancy infrastructure is a key investment direction. According to statistics released by the Ministry of Water Resources, from January to June, the completed investment in water conservancy infrastructure in China reached 569 billion yuan, a year-on-year increase of 9.9%, and the implemented investment in water conservancy construction was 1.01 trillion yuan, a year-on-year increase of 29.2%, significantly higher than the overall level of infrastructure.used excavator used excavator used excavator used excavator

　　In addition, the introduction of policies such as "trade in" has further promoted the clearance of old excavator equipment. In March 2024, the State Council issued the "Action Plan for Promoting Large scale Equipment Renewal and Consumer Goods Trade in", accelerating the clearance of old "National I" and "National II" models, and promoting the transition from existing "National III" to "National IV" models.used excavator used excavator used excavator used excavator

　　Guolian Securities stated that since 2023, many local governments have accelerated the phasing out of non road mobile machinery at the national level 2 and below through subsidies, expanding prohibited areas, and raising prohibited emission standards; Under the background of cyclical replacement and "trade in", updating and replacing will become one of the core driving forces for the new round of domestic sales of construction machinery.

　　Continuous repair of export dataused excavator used excavator used excavator used excavator

　　Since 2020, leading domestic construction machinery companies such as Sany Heavy Industry, XCMG Machinery, and Liugong have successively embarked on a global layout, investing in the construction of overseas production bases, and promoting the localization and globalization of research and development and service networks through mergers and acquisitions. Going global for construction machinery has gradually become a "must compete place" for domestic OEMs.

　　With the continuous improvement of the export layout of domestic leading host factories, the growth rate of domestic construction machinery exports continues to increase. Statistics show that in 2020, the overseas sales volume of domestic construction machinery was about 270000 units; By 2023, the sales of domestic construction machinery will increase to 660000 units, with an annualized growth rate of nearly 35%; Among them, the export volume of excavators has increased from 34700 units to 105000 units by 2023, with an average annual growth rate of 44.64%; In this context, the proportion of overseas construction machinery sales has also increased from 18% in 2020 to 37% in 2023.used excavator used excavator used excavator used excavator used excavator

　　According to annual report data, in 2023, the overseas revenue of Sany Heavy Industry, XCMG Machinery, and Zoomlion Heavy Industry reached 43.258 billion yuan, 37.22 billion yuan, and 17.905 billion yuan, respectively, with year-on-year growth of 18.28%, 33.7%, and 79.19%.used excavator used excavator used excavator

　　In the first half of 2024, although excavator exports experienced negative growth after reaching high levels in 2022 and 2023, the overall scale of construction machinery exports still maintained positive growth. According to data released by the China Construction Machinery Industry Association, in the first half of the year, ten out of the twelve major product categories achieved positive export growth. The cumulative export of the twelve major categories of main products was 371700 units, a year-on-year increase of 12.3%.used excavator used excavator used excavator used excavator

　　According to the semi annual report of Zoomlion, the company's overseas revenue was approximately 12.048 billion yuan in the first half of the year, with a year-on-year growth rate of 43.91%. The proportion of the company's overseas business to revenue increased to 49.1%, a 14.32 percentage point increase from the same period last year. During the same period, XCMG Machinery's internationalization revenue reached 21.901 billion yuan, a year-on-year increase of 4.8%. The company's internationalization revenue accounted for 44%, a year-on-year increase of 3.37 percentage points. At the same time, the company's international gross profit margin was 24.41%, an increase of 1.22 percentage points year-on-year; Sany Heavy Industry achieved overseas revenue of 23.542 billion yuan, a year-on-year increase of 4.79%. The company's overseas revenue accounted for 60.77%, an increase of 3.89 percentage points from the previous year.used excavator used excavator

　　According to statistics, in the first half of the year, the overseas revenue of the top five construction machinery manufacturers in A-share sales reached 71.737 billion yuan, a year-on-year increase of 13.39%. The average proportion of overseas revenue of the five manufacturers reached 50.83%.

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The construction machinery industry is gradually recovering

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