South Korean Machine Tool Rapidly Expands Its Market Share in China

In recent years, China's machine tool imports and consumption have occupied the top position in the world for many years in succession, but China still has a big gap compared with countries with advanced machine tool manufacturing technologies such as Germany, Switzerland, Japan, and the United States. At present, Korean machine tools are constantly expanding their market share in China.

In the international market, the machine tool products of Germany, Japan and the United States mainly occupy the high-end market. In contrast, China's and South Korea's machine tool products have a certain degree of convergence, and the competition between the two places and Chinese machine tool companies in the market will become increasingly fierce.

In recent years, the Korean machine tool industry has also developed rapidly. In 2010, the output value of Korean machine tools ranks fifth in the world, and maintains a growth rate of more than 60%. South Korea's exports to China's machine tools account for 43% of the total, and the company hopes to further expand its market share.

In 2010, the South Korean machine tool industry showed a recovery growth, and the scale of the industry hit another record high. According to the data released by Gardner Publications Inc. in the United States, in 2010, the production scale of metal processing machine tools in Korea ranked fifth in the world with US$ 4.49 billion, an increase of 63% year-on-year; exports ranked seventh with US$1.68 billion, An increase of 37%; Imports ranked fourth with US$1.44 billion, an increase of 34% year-on-year; and consumption was ranked fourth with US$4.26 billion, an increase of 59% year-on-year. It can be seen that South Korea has become an important part of the world's machine tool market.

According to the analysis of the Korea Machine Tool Industry Association (KOMMA), the Korean machine tool industry can quickly recover from the financial crisis, and a number of indicators are significantly higher than the record of the 2008 best results. In this regard, domestic demand for automobiles, electronics, and general machinery in South Korea is recovering significantly. On the other hand, the Asian market including China, and emerging markets such as Central and South America have maintained a sustained growth momentum.

According to KOMMA statistics, since 2002, China has been the largest export market for Korean machine tools for nine consecutive years. In 2010, South Korea exported 762 million U.S. dollars worth of metal processing machines to China. Exports not only increased by 49.4% compared with 490 million U.S. dollars in 2009, but also exceeded the record high of 540 million U.S. dollars created in 2008. South Korea's machine tool exports to China account for 43% of its total exports, which is higher than the 40.8% in 2009 and 26.3% in 2008. From January to April 2011, South Korea exported 247 million U.S. dollars worth of metal processing machine tools to China, a year-on-year increase of 29.4%. The data shows that the development of Korean machine tools in recent years and their ability to recover rapidly from the crisis are inseparable from the rapid development of the Chinese machine tool market.

In 2010, the top three categories of Korean machine tool export categories were: CNC lathes accounted for 364 million U.S. dollars, processing centers accounted for 339 million U.S. dollars, and presses accounted for 244 million U.S. dollars, up 17.4%, 57.6%, and 41.3% respectively. Among CNC machine tools, machining centers and presses, which are the three largest exporters of Korean products, China is its largest importer. Among them, the export volume of processing centers to China increased by 77.5% year-on-year to US$209 million, accounting for 61.6% of the total.

Due to the promising prospects of the Chinese machine tool market, Korean machine tool manufacturers have expressed that they will develop products suitable for the needs of Chinese users, thereby expanding the market share in China. Doosan is Korea's largest machine tool company. Its executive director of company sales said that compared to German and Japanese machine tools, Doosan's machine tools are low in price, but they are not inferior in quality and functionality. China's automobiles, construction machinery, and wind power are all key development priorities. Doosan is also actively looking into the market demand from these areas. Doosan will accelerate the development of new products and strive to increase its market share in China from the current 3% to 7-8% within five years.