Infrastructure investment accelerates excavator industry will welcome "spring flowers"

In January 2017, the sales volume of the excavator industry was strong, with a year-on-year increase of more than 50%. According to the analysis of industry insiders, with the further acceleration of China's infrastructure investment in 2017, the excavator industry may usher in a "spring blossom". Due to the disturbance of the Spring Festival, since entering February, excavator sales have remained hot, from the terminal show, dealers in many provinces feedback that the post-holiday sales have greatly exceeded the monthly sales level in February of the same period last year. The terminal demand is strong, has been transmitted to the main engine factory manufacturers and upstream parts enterprises, from the current factory stocking, orders have increased significantly, production schedules are full, and some models have been out of stock.

According to the data of the Construction Machinery Association, the sales volume of excavators in January was 4,548 units, a year-on-year increase of 54%.Big diggingThe year-on-year growth was 57%, 33% and 107%, respectively. All provinces have announced this year's investment, more than one trillion is not a few, infrastructure, PPP, mining and rural construction areas have become the main force point, the excavator industry seems to be opening a new "golden age". According to the law of the industry market, January is the traditional off-season for sales, but according to the data of the Construction Machinery Association, in January, 25 excavator companies included in the statistics sold more than 4,548 excavators, an increase of 54% over the same period last year. In fact, since September last year, excavator sales have increased by more than 70% year-on-year for four consecutive months.

Excavator type

According to the statistics of the China Construction Machinery Association, the country's major excavator enterprises sold a total of 6,910 excavators in December, a year-on-year increase of 75.0%, an increase from the growth rate in November (a year-on-year growth rate of 72.6% in November). The cumulative sales from January to December were 70,320 units, a year-on-year increase of 24.8%, and the growth rate of excavator sales turned positive for the first time since 2013. From the perspective of the structure of excavator sales, the sales growth rate of large and small digging is fast.

According to the statistical caliber of the sales data of the main excavator enterprises announced by the Construction Machinery Association, in 2016, the sales volume of large digging was 9,037 units, a year-on-year increase of 78.2%, the sales volume of small digging was 40,766 units, a year-on-year increase of 31.1%, and the sales volume of the digging was 24,887 units, a year-on-year increase of 23.4%. The sharp rebound in sales of big digging confirms the logic of price increases that we emphasized in the early stage. Due to the supply-side reform, the prices of coal, ore and other resource products have rebounded, which has led to an increase in the operating rate of the relevant downstream, which in turn has driven the demand for large excavators. The increase in sales of small digging is due to the increase in municipal construction, the increase in the market share of leading companies, and the huge potential for overseas exports.

In January, Sany Heavy Machinery continued to maintain its position on the list, with sales exceeding 1,000 units, far ahead of many competitors, and continued to hold the leading position in small digging and medium digging. The sales volume of its SY75C-10 excavator reached 261 units in a single month, even exceeding the total sales of all models of the sixth-ranked company.

From the tonnage point of view, in January, the proportion of large, medium and small digging were 51%, 39% and 10%, compared with the whole year of 2016, the proportion of digging increased slightly, the proportion of small digging declined slightly, and the proportion of large digging was basically flat.

Excavator sales area

From the perspective of sales area, Jiangsu, Shandong, Yunnan sales are in the top three, all of which have exceeded 300 units, and the top three provinces in 2016 are also the above three provinces, which is enough to show that the market demand in these three provinces continues to be strong. Sales growth in February is expected to be more than 100%.

In 2017, the good momentum of the construction machinery industry continued, and the market research and analysis report of the construction machinery industry analyzed that the main reasons for the recovery of construction machinery are the following three aspects: the growth of downstream fixed asset investment, the low base effect of last year's sales, and the mandatory implementation of the national three standards. After more than four years of industry adjustment, the listed companies in the construction machinery sector have basically stabilized the number of equipment operating hours, gross profit margin, debt ratio and other indicators, profitability has begun to recover, and the overall sector adjustment is basically over.

Excavator export

In January, about 600 excavators were exported, accounting for about 13% of total sales, a new high since August last year. From the perspective of export product structure, the digging accounts for more than half of the total, which is different from the sales structure dominated by small digging in the domestic market.

In fact, since September last year, excavator sales have increased by more than 70% year-on-year for four consecutive months.

It is understood that the last big growth cycle of China's excavator industry was from 2009 to 2011, with an average annual sales growth rate of more than 50%, of which the year-on-year growth rate in 2010 reached a peak of 131%, and finally sales reached 178,000 units in 2011. However, since the second half of 2012, the construction machinery industry quickly fell to the freezing point, and then sank for nearly 5 years. Nowadays, with the gradual strong sales of the excavator industry, excavators may usher in a "spring bloom".

From the perspective of infrastructure, it is expected that the growth rate of infrastructure investment in 2017 will exceed 20%. In the context of real estate regulation and the construction of long-term mechanisms, infrastructure will become the government's main means to maintain steady economic growth, including high-speed rail, urban rail transit, underground comprehensive management and other infrastructure construction will remain high. At the same time, the above-mentioned institutions are also "not pessimistic" about the growth rate of real estate investment in 2017. Another set of data has given more hints: as of now, plans for fixed asset investment have been introduced one after another. Of the 22 provinces that have clearly announced their annual fixed asset investment targets, 16 provinces accounted for more than 100% of GDP in 2017 in 2017.

Driven by the "One Belt, One Road" strategy advocated by China, many major infrastructure construction projects have been built in many countries along the way, and these major projects are basically undertaken by China's construction army and are in full swing. These Chinese construction troops, a large number of purchases are China's construction machinery, will greatly drive China's construction machinery, especially the construction machinery of the excavator market climbing; After nearly five years of transformation and adjustment, starting from 2016, China has entered a new "13th Five-Year Plan" period of national economic construction, according to the national "13th Five-Year Plan", the "13th Five-Year Plan" period, will set off a new round of major new infrastructure construction new upsurge.

According to the "Medium and Long-term Railway Network Plan", "Three-year Action Plan for the Construction of Major Transportation Infrastructure Projects" and other national plans, China will focus on promoting the construction of transportation infrastructure projects. In 2017, the growth rate of infrastructure investment will remain at the level of about 20%, and the overall scale is expected to be about 16 trillion yuan.

These new major infrastructure constructions mainly include high-speed rail, urban rail transit, new energy, new airports, new farmland and water conservancy, new towns, new countryside (including beautiful villages), and new tourism facilities. It will bring a new round of orderly development of construction machinery and excavators. This new round of orderly development has begun in the second half of 2016 at the beginning of the "13th Five-Year Plan" and will gradually increase from 2017.