Analysis of the Economic Operation of Chinese Machinery Industry in the First Half of 2010

In the first half of the year, the economic development of the machinery industry was generally good, but under the influence of many factors, the growth rate was falling month by month. It is expected that the downward trend will continue in the second half of the year, but it is still expected to achieve about 20% growth throughout the year.

In the first half of the year, the overall economic situation of the machinery industry was relatively good

1. Overall rapid growth in production and sales

Industrial added value: From January to May this year, the value added of the machinery industry increased by 24.4% year-on-year, ranking the first among all industries in the industry. It was 5.9 percentage points higher than the average growth rate of the industry in the same period of 18.5%.

Industrial output value: From January to May this year, the industrial output value of the machinery industry was 528.54 billion yuan, a year-on-year increase of 38.93%, and the growth rate reached a new high in recent years. Among them, construction machinery and automobiles have the highest growth rate, which exceeds 50%; machine tools, basic parts and internal combustion engines are the next most, about 40%; electricians, instrumentation, file management, and petrochemical general use are again about 30%; agricultural machinery and food packaging machinery. Heavy aircraft, lower, 20% -25%.

Production and sales rate: From January to May this year, the production and sales rate of machinery industry products was 97.63%, an increase of 0.62 percentage points year-on-year; from January to May, the sales value of machinery industry sales increased by 38.93% year-on-year, and the total value of “inventory” increased by 21.44% year-on-year. The growth rate of output value was 17% lower; the year-on-year increase of “finished products” in “inventory” was only 8.74%, which was 13% lower than the increase in the total value of “inventory”; this group of figures showed that the sales situation of products was good.

Product output: Accumulated from January to May this year, of the 118 main products, 104 production increased year-on-year, accounting for 88%; 14 declined, accounting for 12%. The products with reduced output are mainly agricultural machinery products such as large tractors and combine harvesters, power equipment such as transformers and hydropower equipment, and metallurgical machinery such as metal rolling mills.

Product prices: Since the financial crisis, until November last year, the price index of machinery products has been declining. However, since November last year, the price index of mechanical products has stopped falling and has continued to increase this monthly upward trend since the beginning of this year.

2. Significant increase in operating efficiency

Accumulated from January to May this year, machinery industry:

The profit reached 353.6 billion yuan, an increase of 86.13% over the same period of last year; of which, the growth rate of automobiles and construction machinery was the highest year-on-year, exceeding 110%; the second is about 80% for machine tools, meters, files, basic parts, and internal combustion engines; electricians, heavy mines, Petrochemical GM is again about 40%; agricultural machinery and food packaging machinery are low, but it also reaches 25% or more.

The total tax amount was 174 billion yuan, an increase of 39.88% over the same period of last year;

The profit rate of main business income was 6.94%, an increase of 1.62 percentage points year-on-year, reaching the highest level in history;

The company's loss-making loss decreased by 5.12% year-on-year;

The loss of loss-making enterprises decreased by 32.69% year-on-year.

3. Technological progress and structural adjustment continue to make progress

(1) The development of new products tends to be active

From January to May this year, the machinery industry completed a total output value of 1.0141 trillion yuan for new products, a year-on-year increase of 46.24%, which was significantly faster than the same period of the same period in the total industrial output value of 38.93%.

(2) Accelerating the pace of independent innovation of key components and special high-quality raw materials

Some independent key innovations and special high-quality raw materials that have long been subject to import have accelerated the pace of independent innovation. For example, Northern Heavy Industries has successfully developed large-diameter thick-walled seamless steel tubes that are urgently needed for supercritical boilers by relying on homemade 36,000-ton vertical extruders. High-quality cold-rolled oriented silicon steel sheet developed by Baosteel and Wuhan Iron and Steel Co., Ltd. has begun to expand its application in the production of large-scale domestic transformers; Yixing and Baosteel have cooperated to develop U-shaped tubes that are urgently needed for large-scale thermal power and nuclear power equipment, such as Western Electric Company and TBEA. A high-level AC/DC high-voltage insulated casing rolling production line was built. Three series of tap-changers for Shanghai Huaming 500,000 volt transformers have passed the appraisal. Daquan Group has successfully developed the frequency conversion required for large-scale direct-drive wind power equipment. The control system, the breakthrough in the localization of large-scale valves for long-distance pipelines for natural gas, etc., and the situation in which these products are subject to imports for a long time is about to change.

(3) From January to May, the state-owned enterprises, large-scale enterprises, and central and western regions showed a good momentum of development

(For details, please see the attached table. Gross output value in the table: RMB 100 million)

State-owned Enterprises - Private Enterprises - Sanzi

Gross output value

Year-on-year growth: 43.86%-37.14%-38.31%

Large Business - Medium Business - Small Business

Gross output value

Year-on-year growth: 42.29%-32.31%-41.52%

Eastern Region - Central Region - Western Region

Gross output value

Year-on-year growth: 36.59%-48.16%-38.42%

Second, the growth rate is declining month by month, we must enhance awareness

1. Although the growth rate was high in the first half of the year, it showed a trend of falling month by month.

The high growth rate in the first half of the year was closely related to the lower base figure in the same period of last year. With the rapidly rising base after the second quarter of last year, the monthly growth rate this year has shown a continuous decline.

From the year-on-year growth rate of output value, the monthly growth rate of the mechanical industry fell by 2%. According to this trend, the annual growth rate may fall to 20%-25%.

From the trend of changes in profit growth, the YoY growth rate from January to May fell by 54 percentage points from January to February.

The decline in the growth rate of the automotive industry is most obvious: the output value of the auto industry in January-February increased by 81.61% year-on-year, fell to 54.16% in the first five months, and the growth rate dropped by 27%; the profit growth rate in January-February was a year-on-year increase. 382.73%, from January to May to 144.00%, the growth rate dropped by 238 percentage points.

2. Although there is a recovery growth in exports, there is a lot of uncertainty

From January to May, the accumulated export value of machinery industry reached 95.6 billion U.S. dollars, a year-on-year increase of 29.70%. Although the growth rate is high, it is still recovering growth. The average monthly foreign exchange earned in less than US$20 billion in January-April is much lower than the monthly average of US$22 billion in the second quarter of 2008 before the financial crisis. Although the export value in May increased to US$22.3 billion, the shadow of the debt crisis in Europe has not been dispersed. With the renminbi regaining its upward trend, it is difficult to predict whether it will be possible to continue the trend in May.

3. Is the import growth rate is much higher than exports, this year may be able to reproduce the deficit

From January to May, the accumulative use of foreign exchange in the machinery industry was 94.9 billion U.S. dollars, a year-on-year increase of 50.88%. This growth rate was much higher than the level of 29.70% of export growth during the same period. In May, the year-on-year growth rate of exports increased sharply to 45.64%, but imports increased by 57.06% during the same period, which is faster than the growth of exports. We are very worried that this year, the machinery industry may resume its deficit after achieving a basic balance of import and export trade in 2006 and a subsequent rapid increase in the trade surplus.

4. I was strongly criticized by international competitors for independent innovation of high-end equipment

In recent years, under the guidance of the national policy, a group of domestically-funded key enterprises have increased their independent innovation efforts in high-end equipment products, and have made gratifying progress. However, this has caused anxiety among international competition partners. After they have made enormous progress in the development of independent innovation, they have immediately changed their prices from the previous sky-high prices. They have desperately reduced their prices and are desperately competing with me for users, trying to stop me from upgrading.

5. It is a sharp slowdown in the growth rate of investment in fixed assets

From January to May this year, the machinery industry completed a total of 547.9 billion yuan in investment in fixed assets, a year-on-year increase of 26.35%, which is far below the growth rate of around 40% in previous years. It shows that after the investment in fixed assets of the machinery industry has experienced rapid growth for six years after 2004, the growth rate of investment has begun to turn a turning point. The growth of investment in fixed assets has slowed down, and the cooling of demand for mechanical products will certainly play a role.

6. It is not to underestimate the impact of rising exchange rates

The rising exchange rate will not only weaken the competitiveness of our machinery products in the international market, but it is even more worrying that it will stimulate imports. The difficulties of independent innovation in the export of high- and medium-end machinery products and high-end products will increase, and the pressure on the machinery industry will be double.

In short, although the economic operating data of the machinery industry in the first half of this year is very "bright," it still needs to be very calm. In the face of complex and difficult domestic and international economic environment, the entire industry should be more aware of the crisis and prepare for more.

Third, look forward to the year, cautiously optimistic

1. The ultra-high growth in the first half of the year has laid a good foundation for faster growth throughout the year

Regarding the calculation of the annual output value, the total industrial output value of the previous five months has been 5285.4 billion yuan, an increase of 38.93% over the previous year; the output value completed in the first five months is already equivalent to 56% of the total output value of the previous year; this year, the monthly output value is The month is up and in the past three months is above 1 trillion yuan. Even if this level is not to increase in the next few months, the annual output value will exceed 12 trillion yuan, which will be 10.7 trillion yuan more than the level of the previous year. The growth rate is 12%; and the law for many years is higher in the second half than in the first half of the year. Therefore, the total industrial output value this year will definitely increase by more than 12% over the previous year.

Regarding the calculation of profit for the whole year: the cumulative profits realized in the first five months totaled 353.6 billion yuan, with an average monthly rate of 70.7 billion yuan; and in the January-November period last year, the profits were 581.6 billion yuan, with an average monthly rate of 53 billion yuan; the monthly average is assumed in the second half of the year. To achieve profit reductions to last year's level, from January to November this year, a profit of about 670 billion yuan can be realized, which is an increase of more than 15% from the previous year. If the fall is relatively gradual in the second half of the year, the average monthly profit will be about 60 billion yuan, which will be 1-11 this year. The monthly profit of about 710 billion yuan can be increased by more than 20% over the previous year.

2. Most companies currently have more orders, which can basically meet the production requirements for this year

According to a questionnaire survey conducted by 161 key contact companies, although most companies believe that the growth rate will fall in the second half of the year, the overall ordering situation is significantly better than last year, with cumulative orders for 161 key contact companies increasing by 39.07% from the same period last year. , may seem to basically guarantee the normal production this year.

3. Macroeconomic policy orientation is conducive to steady growth in the future

The uncertainties in the recent economic situation (the risk of the European debt crisis, the apparent cooling of the domestic real estate industry, the fall in investment growth, the deceleration of market loans for autonomous demand banks, the cooling of the auto market, the adjustment of export tax rebates, and exchange rate increases) have caused all parties concerned to Concern that macroeconomic policies are enhancing flexibility and pertinence in order to maintain stable and rapid economic development. This will help the machinery industry achieve steady growth in the second half of the year.

In summary, we make the following inferences about the year-round trend of the machinery industry:

1. The year-on-year growth rate in the second half will continue to fall month by month

Although the year-on-year growth rate of the major economic indicators of the machinery industry at the beginning of the year seems to be unusually high, the ultra-fast growth at the beginning of the year has been difficult to sustain under the influence of the increasingly obvious factors that have become manifest and the comparison of the rise in the base value in the second half of last year. The downward trend that began in the second quarter will surely continue in the future. The growth rate curve for the whole year will be high before and low, and month by month.

2. The second is that the probability of a sharp decline or negative growth in the second half of the year is small

Although the year-on-year growth rate of major economic indicators in the second half of the year will continue to decline month-on-month, the fundamentals of the overall situation of the machinery industry and the macro-economy are clearly better than those of the previous year. At the same time, relevant parties attach great importance to the emerging risk indicators in economic operations, and We have made sensitive responses to regulatory policies. Therefore, we believe that there is little chance of a drastic or even negative growth in the economic operation of the machinery industry in the second half of the year.

3. Accumulated for the whole year is expected to achieve double-digit growth over the previous year

Given that the rapid growth in the first half of the year has laid a good foundation for achieving rapid growth throughout the year and that the probability of a sharp decline in the second half of the year is not significant, despite the fact that the growth rate will continue to decline month by month, the machinery industry will have a It is entirely possible to achieve double-digit growth in the previous year.

We expect this year's machinery industry: production and sales growth rate of up to 20%; profit growth rate of up to 20%; export growth rate of up to 15%.

Fourth, some suggestions

1. To withstand the unreasonable pressures of certain developed countries, and firmly guide key projects to purchase high-end equipment of our own innovation. It is recommended that foreign businessmen who cut prices in bad faith, compete with me for improper orders, and criticize the process of independent innovation of high-end equipment should resolutely use anti-dumping measures to counter it.

2. In the "Twelfth Five-Year Plan", increase support for independent innovation of high-end equipment. The definition of "high-end equipment" should not be simply based on whether there is "intelligence" or not. It is recommended that key equipment urgently needed for key projects, high-tech difficulty, and heavy dependence on imports be included in "high-end equipment."

3. The RMB exchange rate should not rise too fast. As far as the machinery industry is concerned, the export profit margin of most products is very small. Therefore, it is recommended that the rate of appreciation of the RMB should not be excessively fast and the rate of appreciation should not be too high. If the appreciation of the renminbi is relatively high, it is recommended that the state provide reasonable compensation for export of the equipment that has a long implementation cycle.

4. Increase the scale of grid investment and protect the backbone of the equipment manufacturing industry. Since this year, due to lack of investment in power grids, transformers, high-voltage switches and other high-voltage power transmission equipment over-competitive prices and diving. This is suicidal to the long-term development of equipment manufacturing companies. It is hoped that the country will speed up the examination and approval of power transmission and transformation projects, increase the scale of power grid construction, and restore the prices of related products to normal levels, so as to avoid the backbone enterprises in the power transmission and transformation equipment manufacturing industry from becoming depressed.