Construction Machinery Supervision Blank Standard Lower Twelfth Five-Year Plan to Encourage Merger and Reorganization

The "Economic Information Daily" reporter learned on the 26th that the "12th Five-Year Plan" (hereinafter referred to as the "Planning") of the construction machinery industry has completed the first round of revisions in accordance with the revised opinions of the Ministry of Industry and Information Technology and will be discussed at the Construction Machinery Industry Association on the 26th, and The Ministry of Industry and Information Technology and the Ministry of Commerce discussed the matter and is expected to formally promulgate in October this year.

Mao Zhongwen, deputy secretary-general of the Construction Machinery Industry Association responsible for drafting the plan, is also the compiler of five five-year industry development plans for the “7th Five-Year” to “Eleventh Five-Year Plan” of the construction machinery industry. He was interviewed by the reporter of “Economic Information Daily”. Said that the "planning" will encourage the industry to reorganize mergers and acquisitions, use market competition mechanisms to eliminate backwardness, and control the approval of land for low-level duplicate construction projects and engineering construction projects. By the end of the “Twelfth Five-Year Plan”, the sales scale of China's top 100 engineering machinery enterprises should reach over 85% of the entire industry, and strive to cultivate large-scale enterprises with strong competitiveness and innovation ability into aircraft carrier-type international famous companies.

According to Mao Zhongwen, China’s construction machinery sales and sales have now become the world’s largest. From January to July this year, the sales of eight major models increased by 67%, and sales increased by 63%. It is expected that the industry will achieve growth this year. More than 30%, exports are expected to reach 8.5 billion to 9 billion US dollars.

Restricting regulatory blanks is too low

In the numerous corporate mid-year reports just released, the construction machinery industry is undoubtedly the most dazzling segment. The unexpectedly explosive growth of its performance has also surprised industry experts. In fact, the industry has maintained rapid growth since 2006, with an average annual growth rate of 24.7% from 2006 to 2009. Imports in 2005 were US$3.064 billion and exports were US$2.94 billion. From deficit to basically flat, by 2008, import volume rose to US$6.016 billion in double years, doubled; exports rose to 13.422 billion. The dollar, an increase of 356%.

However, Mao Zhongwen told the "Economic Information Daily" reporter that although the development momentum is very good, there are still many weak links in the construction machinery industry, and there are multiple domestic and international constraints.

First of all, the most serious problems lie in regulation and standards. Due to the low standards and the lack of supervision, a considerable part of the approximately 3.5 million engineering machinery currently in operation in China is part of this phase-out or scrapped product. Private transactions are serious and tax evasion and other phenomena are common. What is even more shocking is that due to the lack of supervision and the large domestic market demand, a large number of second-hand mobile phones are dumped in China. China has now become the center of the international inferior mobile phone market.

In addition to the international low-quality second-hand mobile phones, many domestic enterprises with agricultural machinery licenses and small-scale simple construction machines are used in industrial projects and are largely removed from construction machinery in Shandong, Jiangsu, and Hebei. They not only have excessively exceeded standards in terms of energy consumption, noise, etc., but also wear the coat of “agricultural construction machinery” to receive state financial subsidies and enjoy sales tax incentives. This not only disrupts the market, runs counter to energy saving and emission reduction, but also buries potential safety hazards. Mao Zhongwen said, “For simple small-scale construction machinery that serves the three rural economy, we must strictly control product quality, safety, environmental protection, and other regulatory standards, and establish a threshold for entry into the market. All used machines should have files, have household registration, and the time for scrapping should be clearly defined. A compulsory elimination system should be established so as to maintain the healthy development of the industry."

Another problem in the construction machinery industry is that key component manufacturing and core technologies severely restrict industry development and industrial transformation. The key components of the current construction machinery are in serious shortage. The key components used in the high-end technology host products are almost entirely imported. “Some of the internationally strong companies either don’t give them or have limited supply due to the consideration of their own industrial safety, and there are price increases. , delayed delivery and other ways to card our neck." Mao Zhongwen said without anxiety. It is understood that intellectual property protection in China's construction machinery industry is very weak today, and open and undisclosed infringements between enterprises have occurred from time to time. The problem of the parts and components industry is even more serious, and almost 90% of the companies are keen to imitate.

In addition, there is a problem of low-level homogeneity and disorderly competition in the construction machinery industry, resulting in excess capacity and low-quality and low-efficiency products circulated in the market.

Planned sales growth and added value of products doubled

In view of the problems existing in the construction machinery industry, the main theme of this "12th Five-Year Plan" is to adjust the structure and change the mode of growth. According to the forecast of the domestic market and the development of the international market, the planning of the construction machinery industry in China will reach 900 billion yuan in sales by 2015. The average annual growth rate will be approximately 17%, of which exports will account for about 20 billion US dollars. The largest exporter of international construction machinery. At the same time, further increase the technical value of product sales, of which 20% of the growth rate should be reflected in the increase in product technology added value.

The international construction machinery manufacturing industry is mainly concentrated in four major regions: North America, European Union, Japan, and China. From 2002 to 2009, China’s growth was the strongest and sales increased by 379%, followed by the EU and Japan, which increased by 54.46% and 78%. From the perspective of exports, Japan and the EU are major exporters, but China’s export growth is most prominent. In 2008, exports increased by 17.8 times compared with 2002, accounting for 18% of the international circulation, and have become major exporters of international construction machinery.

From the market demand, the largest demand is China. From 2000 to 2009, China’s market share rose from 7% to 47.71%; Western Europe dropped from 30% to 14.47%; North American market dropped from 36% to 12.37%; Japan The market dropped from 15% to 3.8%. Excluding the financial crisis, it can still be seen that the Chinese market and other emerging markets such as India, Brazil and Russia are becoming the main markets for the development of international construction machinery.

“The market demand for construction machinery and the scale of investment in the entire society are two brothers,” Mao Zhongwen said vividly. “The market demand and investment scale over the years have a regular strained relationship, and the growth in total fixed asset investment in the society during the 12th Five-Year Plan period has increased. The average rate of this rate should be controlled at a level of 20%, and the analysis shows that in 2015 China's market demand for construction machinery will reach 851 billion yuan."

It is reported that the "Planning" will guide the development of construction machinery products to the middle-to-high-end direction, vigorously increase the proportion of independent intellectual property rights, and limit the entry of low-end products to the market through the technical and regulatory standards of environmental emissions, safety, energy consumption, etc. Poor quality products with hidden safety hazards must be strictly supervised, and the proportion of high-end products must reach a certain level during the “Twelfth Five-Year Plan” period.

Focus on restructuring and independent innovation

It is understood that the "planning" will encourage the industry to reorganize mergers and acquisitions, eliminate backwardness through market competition mechanisms, and control the approval of land for low-level duplicate construction projects and engineering construction projects. According to the "planning" goal, by the end of the "Twelfth Five-Year Plan", the sales scale of China's top 100 engineering machinery enterprises must reach over 85% of the entire industry, and strive to cultivate large-scale enterprises with strong competitiveness and innovation ability to become aircraft carrier-type international famous the company.

From the perspective of specific companies, Xugong Group, Zoomlion (000157, stocks) and Sany Heavy Industry (600031, stocks) plan to achieve sales revenue of more than 100 billion yuan in the “Twelfth Five-year Plan” period. Liugong (000528, shares) shares and Shandong Heavy Industry Group set sales targets at the end of the “Twelfth Five-Year Plan” at 50 billion yuan. Other large-scale enterprises such as Xiagong, Longgong and other 11 large-scale group companies are expected to reach 600 billion yuan in sales in 2015, accounting for more than 60% of the industry scale.

Mao Zhongwen said, "Original innovation, integrated innovation, introduction, digestion and absorption, and re-innovation must be implemented as important goals. We must strengthen the construction of innovative R&D systems for basic technologies and key supporting parts and components, such as common technologies, and recommend that outstanding projects be selected through competition. Prepare specific specific plans that are in line with the development of the market economy and include them in the key support development targets of the Ministry of Industry and Information Technology and the Ministry of Commerce during the 12th Five-Year Plan period.”

Mao Zhongwen also said that in the "planning" discussion draft, it is proposed to adjust the direction and support of the country's fiscal policy and industrial policy support. In addition to the adjustment of the tax rate of the entire industry, increase the rate of tax preference for energy-saving emission reduction products. It is suggested that the definition of the industrial structure adjustment of the equipment manufacturing industry should be defined by the principles of expression, encouragement, restriction, and elimination of products in the relevant product areas in terms of laws, regulations, technical standards, and industry standards. At the same time, speed up the revision of industry and product technology standards, and gradually follow international standards, highlighting technological progress and innovative development ideas.

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