Construction Machinery Industry Analysis in 2023 And Outlook for 2024

By the end of 2023, the report card of the construction machinery industry has been basically finalized. According to the recently released November sales data, excavator sales, as a barometer of the construction machinery industry, have experienced negative year-on-year growth for 12 consecutive months. The domestic market is still in a downward cycle, the demand for new machines is not strong, domestic sales have declined significantly year-on-year, and exports have been affected by the high base, and the year-on-year decline has further expanded. Experts believe the industry has yet to hit bottom.

        Recently, the Excavation Machinery Branch, Construction Hoisting Machinery Branch, and Construction Mechanization Branch of the China Construction Machinery Industry Association held industry annual meetings at the end of the year. Industry experts from all parties conducted in-depth analyzes of related fields.

The decline in excavating machinery is expected to gradually narrow

        According to data, in November 2023, 7,484 excavators were sold domestically, a year-on-year drop of 48%. Domestic sales continue to be under pressure, mainly due to factors such as excess inventory, insufficient demand, and a high base due to offset sales of National III equipment in the same period last year. Looking ahead, the base of domestic excavator sales in the same period will enter a low level, the downward pressure will be alleviated, and the decline is expected to gradually narrow.

        Su Zimeng, President of the China Construction Machinery Industry Association, reviewed the operation of the industry this year at the annual meeting of the Excavating Machinery Branch and Industrial Internet Branch of the China Construction Machinery Industry Association held in Changzhou, Jiangsu Province in November. He emphasized that although the industry is facing a bottom-line shock in new machine sales , high social stock increase, more intense corporate competition and other challenges, but the construction machinery industry is generally optimistic in the long term, and we are cautiously optimistic next year.

        Huang Min, president of the Excavating Machinery Branch of the China Construction Machinery Industry Association, summarized the industry situation in 2023 and said that currently, the development of China's excavating machinery industry has entered a period of increasing uncertainties and is facing the triple pressure of shrinking demand, supply shocks, and weakening expectations. Although the industry has undergone certain cyclical adjustments, its characteristics of strong resilience, great potential, and vitality have not changed, and the foundation and conditions supporting the high-quality development of the industry have not changed.

        Leaders of leading companies in the industry evaluated this year's construction machinery market at the meeting. Yu Hongfu, director of Sany Group and president of Sany Heavy Industry, analyzed that the era of extensive growth has become history, and a high-speed rebound is unlikely.

        Zeng Guang'an, Secretary of the Party Committee, Chairman and CEO of Guangxi Liugong Machinery Co., Ltd., said that construction machinery is a strongly cyclical industry. All difficulties are a baptism of the past and the price of tomorrow's nirvana. The industry needs to adhere to the right path, reflect rationally, and have the courage to innovation.

        Yang Dongsheng, chairman and party secretary of Xuzhou Construction Machinery Group Co., Ltd., said that over the past year, China's construction machinery industry has entered a new downward cycle, with industry sales and profits shrinking across the board. At the same time, since the third quarter of 2023, the sales growth of the world's leading overseas brands, led by European, American and Japanese manufacturers, has also slowed down. Overall, the global construction machinery industry is entering a new round of consolidation, and future development is full of great uncertainties.

Construction hoisting machinery market stabilizes

        As an industry that is sensitive to market demand, construction hoisting machinery is facing greater pressure this year. Yu Lekang, president of the Construction Hoisting Machinery Branch of the China Construction Machinery Industry Association, said at the recent industry annual meeting that construction hoisting manufacturing companies have fierce price competition, and leasing companies have suffered large losses. The overall sales volume of mainstream products of manufacturing companies continues to be under pressure, while exports maintain a growth trend, which partially offsets the decline in the domestic market. Manufacturing companies actively explore the international market through research and development of new products and new technologies, and their development is generally stable.

        According to statistics from the branch on 30 major industry manufacturing companies, the number of tower cranes and elevators sold in the first ten months was approximately 28,700 units, with a value of 17.9 billion yuan. The total number of industry sales fell by 25.5%, and the value fell by 11.3%. Yu Lekang analyzed that compared with the overall good profit performance of construction machinery companies, construction hoisting machinery has declined significantly in recent years. There are two main reasons: the real estate downturn has not bottomed out, and the unique conditions of the construction hoisting industry. In view of the current situation, the primary task of industry enterprises is to "survive". As for how to "survive" and "survive" with quality, Chairman Yu put forward four suggestions: control risks, pursue innovation, and do Good positioning and precise management.

The overall operation of the industry will remain stable in 2024

        Meng Wen, vice president of XCMG Engineering Machinery Co., Ltd., said: "China's infrastructure construction, real estate and other fields may stabilize and rise in 2024, and affected by this, the construction machinery industry will most likely achieve steady development or a slight decline."

        According to Guo Xuehong, Vice President of Zoomlion Heavy Industry Co., Ltd.: "Whether in 2024 or in the medium and long term, China's construction machinery market is unlikely to experience significant growth again. Under progressive development, emerging sectors such as China's mining equipment and aerial work equipment will , it is very likely that it will become a star segment among them.”

        As a professional manufacturer, on this issue, Xue Xiaoqiang, executive deputy general manager of Tongli Co., Ltd. and executive managing director of Tongli Technology, said: "In the medium to long term, China's mining equipment market will still show a positive growth trend, among which low-carbon , green transformation will bring a new round of development to enterprises."

        Miao Jianguo, deputy general manager of Sany Heavy Machinery Marketing Company, believes: “For Chinese construction machinery manufacturers, on the one hand, the domestic market demand will still be considerable in the future; on the other hand, the contribution of overseas markets to enterprises will accelerate in the future. , even surpassing the domestic market.”

        Regarding the forecast for 2024, Wu Peiguo, Secretary-General of the China Construction Machinery Industry Association, made a report on industry operation analysis and development trends. He pointed out that the current industry operation is generally stable and shows a positive development trend, but there are obvious differences between products. Domestic The market is still in the bottoming stage, the international market is experiencing high fluctuations, and the industry has entered a new stage of wave-like development. The overall operation of the industry will remain stable in 2024, and the industry will continue to be stable and good in the long term.