The construction machinery industry is picking up Sany Heavy Industry's attack and remodeling

Since the second half of 2016, the construction machinery industry has begun to recover. During this period, the industry has experienced a round of reshuffle, the market concentration has increased, and foreign brands have gradually withdrawn. After an international layout, Sany Heavy Industry once again set its sights on China, adjusted its product focus and accelerated diversified exploration.

"The message I often receive on WeChat is, 'When will this batch of goods be delivered, if you don't pay it, you will have to claim compensation'." Liang Linhe, director of Sany Group and chairman of the pumping division, said.

According to the staff of Sany Pumping Division, many models of Sany have been sold out.

Behind this is the recovery of the construction machinery industry since the second half of 2016. And the last decade has seen the industry experience a boom and a recession.

According to the construction machinery industry yearbook, the total sales of construction machinery in China increased significantly from 180,000 units in 2006 to 440,000 units in 2011; However, by 2015, the total sales volume was only 120,000 units, which is lower than the level of 10 years ago.

A CICC research report also showed that the total profit of the industry in 2015 was only 36% of that in 2011.

After the tide receded, the construction machinery industry experienced a round of reshuffle, the market concentration increased, and foreign brands gradually withdrew. After an international layout, Sany Heavy Industry once again set its sights on China, and the pace of market expansion and diversified exploration accelerated.

The peak season is superimposed

Liang Linhe did not expect such a strong rebound, and all industrial parks of Sany were in full production, "busy until March Day (the anniversary of the founding of Sany Heavy Industry) did not have a holiday".

According to him, excavators, known as the "barometer" of construction machinery, sold 3,600 units in February this year, a year-on-year increase of nearly four times. From the perspective of the entire industry, the domestic excavator sales in February were 14,530 units, a year-on-year increase of 297.65%.

After the Lunar New Year, it was the peak season for construction, and now it is superimposed with multiple benefits.

"The driving effect of real estate has weakened, mainly due to infrastructure construction. Because now Sany Heavy Industry's excavators sell better than concrete machinery. Liang Linhe said.

Ji Guangcai, honorary president of the Road Construction Machinery Branch of China Construction Machinery Industry Association, analyzed that the entire construction machinery industry will be good this year.

He pointed out that during the two sessions, Premier Li Keqiang mentioned in the government work report that the investment in railway construction and highway and water transportation to be completed in 2017 reached 2.6 trillion yuan. In addition, on February 27, Li Xiaopeng, Minister of Communications, also issued a number of "big red envelopes" at the press conference of the State Council Information Office: the investment in fixed assets of transportation in the 13th Five-Year Plan is expected to reach 15 trillion yuan, an increase of about 2.5 trillion yuan compared with the 12th Five-Year Plan. 2017 is an important year for the implementation of the "13th Five-Year Plan", which is very beneficial to the construction machinery industry.

But as for whether the "warm spring" is sustainable, Liang Linhe said it depends on "how long you roll up your sleeves and do it".

As with the construction machinery, there is also the steel upstream of it. As of February 28, Myspic's domestic steel price composite index was 142, up 10.13% month-on-month and 83.96% over the same period last year. As a "large steel user", the construction machinery industry is facing the challenge of rising costs.

Liang Linhe pointed out that not only steel, but also the prices of some spare parts have increased by 5%-10%. However, the rise in raw materials will not contain the recovery of construction machinery, which can be digested by upgrading technology and appropriate price increases.

The "fog" of unfair competition

Liang Linhe once recalled that there have been achievements and reflections in this complex decade, but the achievements are still the main ones.

In the trough period of 2011-2015, although the sales and profitability of various enterprises were hit hard, in fact, the industry integration was accelerated, "only when the tide is ebbed, do you know who is swimming naked".

Taking excavators as an example, as of October 2016, the number of excavator manufacturers in the country has dropped from more than 110 in the boom period to more than 20. The market share is gradually tilted towards the leading enterprises.

According to CICC's research report, from 2012 to 2016, the share of the top five excavator sales companies increased from 43% to 58%, and the market share of the top 10 companies increased from 70% to 85%.

When it comes to market share, Liang Linhe said that there are no imported brands in the domestic concrete machinery market, and there are still some excavators, but they are no longer the mainstream. Now it is still the mainstream and occupies the high-end market only road machinery, "to take this piece back".

Historically, Sany Group has done it. In 2011, Sany excavator sales accounted for 0.3% higher than the Japanese brand Komatsu, becoming the industry and breaking the pattern of foreign brands dominating the excavator market.

At present, Sany excavators lead the market with about 20% of the market, while the market share of the two Japanese and Korean brands, Komatsu and Doosan, has dropped from more than 15% at the peak to about 7%.

When it comes to the experience of breaking the monopoly, Liang Linhe said that excavators are a fair competition market, and cost performance is important. The implication is that the competition in the road machinery market is not fair.

According to Liang Linhe, it is now the German brand VÖGELE that occupies the domestic highway paver market.

It was learned from a number of marketing representatives of Sany Paver that in individual high-speed construction projects, the Sany asphalt paver purchased by the customer was rejected by the owner's representatives and supervisors.

"In order to meet the requirements of the owner, a customer changed the paint used in the Sany paver used in the high-speed project to a foreign brand logo, and was reported to be driven down the high-speed construction lot two days after being on the road." One representative said.

"In fact, everyone tacitly knows", Liang Linhe revealed, individual owners in the construction of expressways, high-grade highways, bidding and subcontracting bids or explicitly or implicitly require the construction unit to use imported brands.

"In the more remote Xinjiang, Yunnan, Gansu, Ningxia and other places, Sany's pavers can basically be paved on the highway. The restrictions are strict in developed areas such as Beijing, Shandong, and Guangzhou. Liang Linhe believes that these areas are the original paver * 5655 market, imported brands have occupied for a long time, "the construction owner's vision is still stuck in the past".

Ji Guangcai thinks that it is not accurate. He said that there used to be do, but now there are very few such cases.

Ye Min, deputy dean of the School of Engineering Machinery of Chang'an University, also said that there are very few foreign brands of road machinery on the market, and only foreign ones will be used in the construction of some road surfacesroad roller, and mostly old equipment that was purchased in the past.

"Do not let the road situation may only exist in some modified asphalt and other special materials asphalt paving, normally asphalt gradation in line with national standards, most of them are made of domestic products, domestic brands are more cost-effective." Ye Min introduced.

He also pointed out that in the past, domestic pavers were not well controlled in segregation, resulting in discrete materials and the formation of segregation zones, which affected the quality of the pavement. But now the problem of segregation has been solved, and the compactness, compaction and smoothness of the pavement paved by domestic equipment are comparable to those of foreign brands.

Diversified layout

Not only to penetrate the high-end market of road machinery, Sany's business system is also being reshaped.

Liang Linhe introduced that traditional concrete machinery once accounted for 50% of the group's entire business and 60% of the total profit. However, in the past few years, the sales of concrete machinery have declined, and the group's profits have also declined sharply.

"In recent years, the leading products have changed, and the share of Sany excavators has been 5656 for six consecutive years. At present, the construction machinery business is to take concrete machinery as the leading product, and other machinery such as excavators go hand in hand. Liang Linhe pointed out.

New business is also expanding. In 2016, Sany successively obtained the "Weapons and Equipment Research and Production License" and the 3C certification issued by the Fire Product Conformity Assessment Center of the Ministry of Public Security, and entered the military business and fire truck market.

Liang Linhe said that he is very optimistic about the fire truck business, and Sany Heavy Industry is the first approved unit after the Ministry of Public Security stopped issuing fire truck qualifications for 5 years.

"China now has buildings about 600 meters high, but it can't pump water above 400 meters. In another three months, Sany will be able to produce machinery that can pump water to more than 1,000 meters, and the displacement will be able to fill a swimming pool in 15 minutes. Liang Linhe said.

In addition to products, Sany also tried to upgrade the production method.

In this year's government work report, it is pointed out that it is necessary to vigorously transform and upgrade traditional industries, deeply implement "Made in China 2025", accelerate the application of big data, cloud computing and the Internet of Things, and promote the transformation of the production, management and marketing models of traditional industries with new technologies, new formats and new models.

Sany has taken the lead. Sany Group is one of the first enterprises in the construction machinery industry to be selected into the list of 2015 intelligent manufacturing pilot demonstration projects by the Ministry of Industry and Information Technology.

In 2011, the final assembly workshop put into construction in Changsha was already an intelligent manufacturing workshop in Asia*5655, and now more than 80% of the equipment in Sany's factory can be effectively monitored.

"Intelligent manufacturing is not a slogan, it does not mean that the country calls for rushing abroad to buy some high-tech equipment back. It is to improve the overall manufacturing capacity of the enterprise over time, replace some traditional manufacturing methods and manufacturing methods with automated machinery and equipment, and make up for the shortcomings in a timely manner. ”

Liang Linhe also said that the group is also looking for growth points outside the construction machinery business. Sany has a diversified layout in the fields of finance, insurance, incubator and wind power. "The combination of industry and finance is an inevitable trend, and we will focus on the financial field in the future." Liang Linhe said.

According to him, Mitsubishi is a Japan*5655 machinery manufacturing company, but one of its members, the Bank of Tokyo-Mitsubishi UFJ, is also one of the best in Japan. This may imply the expectation of Trinity.

However, Liang Linhe emphasized that Sany's main business is machinery manufacturing and will continue to stick to it.