The last round of sales equipment has been in a large-scale life replacement period, large-scale equipment renewal and a series of policies to boost the industry rebound, is expected to usher in a “large-scale equipment renewal + industry's own renewal” double cycle resonance.
Soochow Securities recently released a review report on the construction machinery industry: the last round of construction machinery up cycle for 2016-2020, according to the 8-year service life, the last round of sales equipment has been in large-scale life replacement period, large-scale equipment renewal and other series of policies to boost the industry rebound, is expected to usher in the “large-scale equipment renewal + industry's own updates “Double cycle resonance. Exports, domestic enterprises in the advantageous areas of the “Belt and Road” countries continue to expand in Europe and the United States market also continued to make breakthroughs, the international competitiveness of domestic brands highlighted. Overseas construction machinery market capacity for the domestic three times, the current head of the enterprise overseas market share of about 5%, while the overseas leading Carter share of 15% +, domestic leading still have more than double the space.'
The following is a summary of the research report:
Investment highlights
CME forecasts August excavator exports +4% year-on-year, turning positive for the first time in 24 years.
CME forecast August 2024 sales of all types of excavators 14,300 units, +9% year-on-year, of which 6,600 units of domestic sales, +17% year-on-year, the growth rate of the ring flat; exports 7,700 units, +4% year-on-year, the first time in 24 years to turn positive year-on-year. 2024 January-August, the overall sales volume of excavators fell by about 2.5% year-on-year, the rate of decline has continued to narrow, in which the domestic market increased by 7%, and export market decreased by 11%, and the data have improved compared with January-July. Looking ahead, the domestic downstream infrastructure investment continues to improve, with the continued promotion of large-scale equipment renewal, excavator market is expected to gradually out of the bottom of the cycle; overseas market, the United States clear interest rate cuts are expected to be superimposed on the U.S. election under the acceleration of the manufacturing industry back to Europe and the U.S. market demand is expected to rebound, optimistic about the second half of this year and next year, the demand for sustained restoration of the overseas market.
Domestic sales bottoming + overseas market expansion, the industry ushered in domestic and international resonance.
The last round of construction machinery up cycle for 2016-2020, according to the 8-year service life, the last round of sales equipment has been in a large-scale life replacement period, large-scale equipment renewal and a series of policies to boost the industry rebound, is expected to usher in a “large-scale equipment renewal + industry itself update” double cycle resonance. Exports, domestic enterprises in the advantageous areas of the “Belt and Road” countries continue to expand in Europe and the United States market also continued to make breakthroughs, the international competitiveness of domestic brands highlighted. Overseas construction machinery market capacity for the domestic three times, the current head of the overseas market share of 5% or so, while the overseas leading Carter share of 15% +, the domestic leading still have more than double the space.
Construction machinery electrification trend highlighted, the domestic host plant is expected to lead the wave of electrification.
In August 2024, Komatsu signed a strategic cooperation agreement with ABB, following the acquisition of ABS at the end of the 23rd to increase electrification again; Caterpillar announced an investment in Lithos Energy at the beginning of the 23rd, and continued to promote the electrification of product research and development. Overseas leading electrification transformation accelerated, construction machinery electrification trend highlights. China has the world's most complete and leading lithium industry chain, 24 years in July the domestic electric loader penetration rate of up to 15.7%, an increase of 11.1 pct; Sany electric digging in the Netherlands to achieve 20 units of contracted pre-sale orders; new energy mixer trucks, mining trucks, heavy trucks penetration rate continues to increase. At the same time, the national policy to actively cooperate with the trend of electrification of construction machinery, August 2024 China released the first batch of seven national standards for electric construction machinery, to fill the gaps in the industry standard, will accelerate the process of electrification of construction machinery market. We believe that the domestic construction machinery host plant is expected to fully benefit from the domestic lithium cost advantage & electrification product first mover advantage, in the Belt and Road, Southeast Asia and other emerging markets to achieve a breakthrough into Europe and the United States after the high-end market, leading the global electrification wave.