Tangles behind the hottest construction machinery

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The tangle behind the bumper sales of construction machinery

"more than two million yuan has been made, and less than one third of the payment has been received." He Shi (a pseudonym) has taken a stake in this rotary drilling rig. In the past 10 months, although he has continued to undertake projects, the pressure of payment collection has made him sigh that it is not easy to change careers. After the 2018 Spring Festival, he Shi, who is engaged in clothing wholesale business, disposed of the clothing booth in Guangzhou and invested nearly one million yuan to buy a rotary drilling rig in partnership with others. At that time, the construction machinery market grew in a crazy way. "We are looking for machines everywhere, and we have asked people to arrange the number." He Shi told the China Securities Journal

according to the data of China Construction Machinery Industry Association, 187393 excavators were sold nationwide in the first 11 months of this year, with a year-on-year increase of 48.4%. From the monthly comparison, the trend shows a trend of high before and stable after. The main outbreak period is concentrated in the first quarter, and the growth rate in the second and third quarters is relatively stable. The fast turnover demand of real estate enterprises, the expiration of the policy of substituting awards for subsidies for PPP projects, and the centralized commencement of major infrastructure projects are the main factors through special manufacturing processes. As for the trend of the construction machinery industry in 2019, insiders believe that the trend of easy processing and tight control of the real estate market remains unchanged, the number of land auctions has increased and the transaction premium rate has decreased, and the business of some real estate enterprises has contracted significantly. The growth or limited construction area of real estate will affect the sales of construction machinery. Infrastructure investment will become an important factor in the sales of construction machinery. It is expected that the sales of construction machinery will increase by% next year

hot market

for construction machinery dealers, after rising in 2017 and 2018, the future trend of the market makes them feel tangled. "Since the beginning of this year, we have sold about 100 rotary excavators in Chongqing, a twofold increase over last year. What will happen next year? The company's statement is that the economy will continue to improve. However, it is not clear how it will be reflected in the fields of infrastructure and real estate." Chen Lu (a pseudonym), an agent of a listed construction machinery company in Chongqing, has a lot of feelings. "Since January this year, the sales volume has risen all of a sudden. The Spring Festival has not stopped, just communicating with the manufacturer to prepare the goods."

according to relevant data, from January to February this year, the sales volume of excavators nationwide increased by 135% and 297.65% year-on-year respectively. "The first two months had a good start, and the confidence of the whole year was sufficient." Chen Lu said

He Shi heard from his friends during the spring festival that "now the project is easy to carry out, and many construction sites lack piling." After some verification, he Shi decided to give up his clothing wholesale business and invest in the sales of construction machinery. But after the Spring Festival, the equipment is hard to buy. Chen Lu said that Sany Heavy Industry, Shanhe intelligent, Zoomlion and other major rotary mining brands basically have to arrange for goods in Chongqing. "Some people who do engineering still ask us to buy a number." At that time, Chen Lu's main work was to communicate with the manufacturer, "we all hope that the manufacturer can give priority to supplying their own products."

from the perspective of Chen Lu, the market calmed down a lot after entering the second quarter. Chen Lu told the China Securities Journal that the brands he represents have sold about 100 units this year. "June and July were booked at the beginning of the year, and the sales volume has been relatively stable since the beginning of the second quarter."

a banker in Hunan told the China Securities Journal that the loan for construction machinery has increased significantly since this year compared with previous years. The mortgage and leasing business of the bank's gold leasing company on construction machinery is very popular. "Some used old machines as collateral, and then borrowed money to buy new equipment; some directly rented. This business has more than doubled over the previous year."

He Shi also said that his career change had a good start. "This rotary excavator is a new model. It has good mountain and wading functions. Road and bridge projects can also be used. Since this year, this machine has not been idle. Various projects are running, including real estate, road and bridge projects."

Chongqing is one of the main working areas of He Shi. He Shi and Chen Lu both said that the real estate construction in Chongqing was better in the first quarter of this year, and the demand for quick turnover of real estate enterprises was obvious. In terms of infrastructure construction, it has benefited from the construction of high-speed rail and new terminal buildings, with many highlights

statistics show that in January this year, the newly started housing area in Chongqing was 17.04 million square meters, a year-on-year increase of 74.7%. In January of this year, the newly started housing area in Chongqing was 60.4503 million square meters, a year-on-year increase of 34.1%. In the first quarter, the growth of new construction area was more obvious

nationwide, according to the data of the National Bureau of statistics, in January, the new construction area of houses was 168800 square meters, with a cumulative year-on-year increase of 16.3%. Soochow Securities pointed out that developers take the initiative to adopt the high turnover mode of quick start, quick opening and quick payment collection in order to alleviate the operating pressure. This is also one of the reasons why the downstream demand for construction machinery continues to be strong

in the fourth quarter, according to the data, the tail raising effect of construction machinery sales was obvious. It is estimated by the industry that the sales volume of excavators in the fourth quarter may reach 50000 units, the production scheduling of construction machinery in the second half of the year is good, the off-season is not light, and the annual sales volume may exceed 200000 units

the growth of sales volume drives the performance of relevant listed companies to rise throughout the year

taking Shanhe intelligent as an example, the company said that the construction machinery industry maintained a high prosperity under the guidance of the policy of making up for weaknesses in infrastructure construction. It is estimated that the net profit attributable to shareholders of Listed Companies in 2018 will vary from 462million yuan to 543million yuan, with a year-on-year increase of 185%-235%. In addition, Sany Heavy Industry, Liugong machinery, XCMG machinery and other major listed construction machinery companies saw significant growth in their third quarter results

each has its own hidden worries

as a bumper year for the construction machinery industry, 2018 is not all joy. Manufacturers, agents and downstream operators of construction machinery have their own hidden worries and troubles

"we are in the same boat with the downstream real estate and infrastructure. If there is a problem in the downstream, it will certainly be transmitted to the upstream." Chen Lu said that, especially in the third quarter, the real estate industry showed a downward trend. "If the trend does not change, the demand for construction machinery in the real estate sector will certainly shrink."

the latest data reflect the different temperatures of the upstream and downstream

according to the data of the National Bureau of statistics, in January, the new construction area of houses was 168800 square meters, with a cumulative year-on-year increase of 16.3%. In June, the sales area of commercial housing was 133100 square meters, a year-on-year increase of 2.2%. The year-on-year growth rate of new housing construction area and commercial housing sales area is differentiated

insiders told China Securities Journal, "from the perspective of downstream construction, infrastructure investment has not been good since 2018, while real estate investment has gone up. However, the trend of real estate investment next year is worrying."

the report on the future situation received by Chen Lu recently shows that the economy will continue to improve next year. But Chen Lu felt that the relevant report was a little vague. "Which one is going well? How about the real estate and infrastructure that are closely related to us? It's impossible to judge."

for he Shi, although the project is full, it is more difficult to collect money. This also made him realize that the "money path" was not smooth. "Fifty or six projects have been completed, and the project funds of more than 2.4 million yuan have now returned about 700000 yuan. It may take several years to return to the current cycle by sharing the shares." He Shi said that the cost of maintaining excavators is increasing. "The transportation cost of rotary excavation and field transfer and the labor cost of rotary excavation operators are rising; the depreciation is 200000 yuan per year, and other maintenance and oil costs are also considerable."

a person from China Construction Second Engineering Bureau, who has been in the industry for many years, told me that compared with previous years, it is more difficult to collect payment in 2018

it is not easy for banks to lend to construction machinery manufacturers. The above bankers told the China Securities Journal that in the past six months, the overdue rate and non-performing rate of construction machinery loans have been rising. "Some people have already brought some leveraged loans to buy equipment, but the payment collection is not good, so they begin to default on their loans."

compared with the purchase of new equipment, the second-hand market of construction machinery and equipment has increased significantly this year. However, compared with the purchase of new equipment, the risk is greater

the biggest risk comes from environmental protection. Lihongbao, Secretary General of excavation machinery branch of China Construction Machinery Industry Association, told China Securities Journal that the high growth since this year includes the demand for "replacement". Due to the stricter environmental protection policy, the national three emission standards have been implemented for excavators, and the national four emission standards will be introduced in the future. This will promote the re release of the stock renewal market. This has also led to an increase in equipment in the second-hand market. "However, most of the equipment is not up to the environmental protection standard, and there are fewer and fewer jobs available."

cautious optimism

at the excavator annual conference held in November, most participants expected the industry to remain stable next year, with a year-on-year growth rate of plus or minus 10%

lihongbao is cautiously optimistic about next year's sales and predicts that the sales volume will increase by%. Shanghai Securities pointed out that the overall trend of the construction machinery sector will be flat next year, with a growth rate in the first half of the year and a negative growth rate in the second half of the year, showing a trend of high in the first half and low in the second half

insiders said that export growth, railway and highway investment growth and the upgrading of the four emission standards for non road countries are expected to be important factors affecting the sales of the construction machinery industry next year

in terms of export, since 2018, the export volume of excavators has continued to grow at a high speed year on year. According to the data of the branch of machinery for cold transportation and storage in small barrels excavated by China Construction Machinery Industry Association, 17351 sets of machinery were exported in a month, a year-on-year increase of 107%. According to the relevant person of XCMG machinery, in the first half of 2018, the company's export revenue increased significantly, mainly concentrated in the "the Belt and Road" region, accounting for about 70% of the company's export volume. In the first half of 2018, XCMG's revenue from products exported to the U.S. market was about 60million yuan, a substantial year-on-year increase

although export has become a new source of growth for the excavator market according to the newly released report "global elastomer market analysis", market participants frankly say that since 2018, the export data has increased significantly, and there are some "export grabbing" factors. Some overseas demanders are worried that the tariff increase next year will place orders in advance in 2018. Therefore, there will be some pressure on the export market next year

according to the data of the National Railway Administration, local development and reform commissions and local statistical bureaus, in 2019, 16 high-speed rail projects across the country are planned to start, with a total investment of 568.1 billion yuan. CITIC Securities said that the supply and demand situation of the railway industry is being optimized and the long-term operation is stable. Insiders predict that the large-scale commencement of railway projects is expected to become an important factor to promote the growth of construction machinery sales

in addition, in February this year, the Ministry of ecology and environment issued the technical requirements for pollutant emission control of non road mobile machinery and its installed diesel engines, requiring that non road mobile machinery powered by compression ignition engines (such as diesel engines) meet the national phase IV emission control level by 2020. This means that the construction machinery industry will implement the national four emission standards in 2020. Lihongbao said that this will promote the renewal of construction machinery stock

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