China Construction Machinery Business Online
November 2012, Crane Market Analysis in China

Truck crane drops most, XCMG accounts for half of the market.

According to the statistics of China Construction Machinery Business Online, from January to November 2012, the accumulative truck crane sales volume in China totals 21,202 units, with a YoY reduction of 36.62%. XCMG Heavy Machinery sells truck crane 11,369 units, with a YoY reduction of 33.91% and a market share of over 50%. In terms of the market share, XCMG Heavy Machinery, Zoomlion and Sany Heavy Industry rank the top three, with the total market share of 91.34%.

Crawler crane sales decline slows down, Sany Science and Technology shows good performance.

From January to November, the accumulative crawler crane sales volume in China is 1459 units, with a YoY reduction of 16.29%, among which, Sany Science and Technology ranks the first with 404 units; XCMG Heavy Machinery ranks the second with 317 units; Fuwa Heavy Industry places the third, with the sales volume of 277 units. From January to November, Sany shows the best performance, with a YoY growth of 30.32%; the other brands perform relatively worse.

Truck-mounted crane growth slows, XCMG retains first place.

From January to November, the accumulative truck-mounted crane sales volume in China is 9350 units, with a YoY growth of 7.16%.

The major truck-mounted crane manufacturers are still XCMG Truck-Mounted Crane and Shijiazhuang Mining Machinery, with the respective sales volume of 4822 units and 1539 units, among which, XCMG has a market share of 51.57%. In addition, Zoomlion Truck-Mounted Crane, Taian Furukawa, Changye Qinghua and Yutong Heavy Industry increase largely, respectively 47.84%, 46.52%, 200.00% and 96.15%; XCMG grows by 7.61% compared with the same period last year.

Macroscopic interpretation

1. China sees its GDP grow by 7.7% year-on-year in the first three quarters of 2012, among which, the growth rate in the third quarter is 7.4%. Chinese economic growth continues to slow down in the third quarter, but it begins to stabilize. It is completely confident for China to meet the full-year growth target of 7.5%. China’s GDP growth rate has slowed down for 7 quarters, but according to the performance of export, investment and consumption and recent money supply, the economy is likely to hit the bottom, and recover in the 4th quarter.

2. Real estate: The growth of the commercial residential housing recently promotes the developers to increase the development strength in a certain extent, which however do not restrain the declining trend of the investment growth. In the future, on the premise that the regulation is not changed, the real estate is not expected to be good.

3. Railway and highway construction: According to the Ministry of Railways, China's fixed asset investment on the railway totals 580 billion yuan, among which, the investment in the infrastructure is 470 billion yuan. This means that there will be a climax on the railway investment in the fourth quarter. From January to August, the 227.77 billion yuan has been invested to the railway infrastructure, accounting for 48.5%, and the rest nearly 260 billion yuan will be used in the railway infrastructure in the fourth quarter.

The investment to the highway also shrinks with the year-on-year reduction of 7.8%, which is the first reduction for 10 years. We do not place too much hope on the highway construction investment in the second half year due to two reasons: 1. the local income from the earth is insufficient; 2. there is no obvious improvement on the local financing platform and channels.

4. Mining industry: Seen from the investment operations in the first half year, the mining industry still keeps rapid growth. However, the price of the resources represented by coal and iron ore shows a downward trend, besides, against the background of the economy slowdown, the demand and price will decline further, which will restrain the investment in the mining industry.

5. Water conservancy and electric power construction: Water conservancy and electric power are also important to promote the construction equipment industry, but not as significant as the industries above. From the operations of the first half year, the two subdivided industries present relatively stable performance. In the second half year, the two industries will maintain the level of the first half year, displaying good stability.

6. Export market: “Made in China” construction machinery products have been exported to many countries, mainly focusing on countries in Southeast Asia and Middle Africa. Along with the increased overseas expansion strength of Chinese equipment manufacturers and improved product quality, the overseas sales volume must show an upward trend. Besides, the high cost performance is the biggest advantage of China-made machinery for export.

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