The component parts industry will become investment highlights of construction machinery field

In recent ten years, China's construction machinery sector (wheel loader, forklift, excavator, road roller, crane, etc) with the good trend of economy rapid development became the world's largest and most competitive market. At the same time, the industrial chain and industrial system got perfect development. Since 2011, however, the economic downturn in Europe and the United States led to export decline of China's construction machinery. Moreover, combined with the macro-control policies being adopted by the State, they made the construction machinery market showing a high to low trend.

Nevertheless, the prospect for the development of construction machinery component parts industry is particularly optimistic, which is expected to get compound annual growth of 19%.

Industry research reportedthat manufacturers would focus on extending to the key component parts industry based on the sustainable performance growth.

Reporter learned that China has leapt to the world's largest construction machinery manufacturer, also became competition land for those large multinational construction machinery manufacturers. Among of the top 50 global construction machinery manufacturers (wheel loader, forklift, excavator, road roller, crane, etc), 37 haveentered in China.

However, at present, China's construction machinery component parts industry base is weak, and the development is still lagging behind. For a long time, China's construction machinery industry has a tendency of emphasizing on machinery and ignoring component parts.  Those core technology of high-level hydraulic parts, transmission parts and control component are mastered by foreign companies. For example, hydraulic pumps, motors, reducer and high-level multi-way valve and so on, all of them did not achieve a technological breakthrough.

As the core component parts of domestic production cannot meet the high standards of construction machinery manufacturing, many technology and equipment depend on import. The supply rate of key parts is low from local manufacturers.

It was known that, part of equipment enterprises gradually involved in the upstream parts due to their own development needs, especially the production field of key parts. At the same time, due to limit on the strength and R&D capability, domestic accessories and components factories (OEM) prefer to establish increasingly close cooperation relationship with equipment enterprises.

Owing to rapid increase of construction machinery (wheel loader, forklift, excavator, road roller, crane, etc) in recent years, the development pace of core component parts industry in China is higher than industry average growth. It is estimated that component parts output value would be close to 50 billion RMB till 2015, and its proportion in construction machinery will be increased from the current 4% to 6%.

The fittings (component parts) industry is expected to maintain a steady rising trend, and will become the highlights of the construction machinery investment.