Study on difficult solutions for construction machinery

Since 2009, the development of heavy machinery industry has gradually slowed down. At the end of 2012, the cumulative growth rate of orders for the entire industry has fallen to 1.9%, and orders for metallurgical machinery have fallen by nearly 30 to 40 percentage points. This will not only affect the company's operating conditions in 2013, but will also affect The next two years of production and operation. The increase in mining machinery and material handling machinery dropped by more than half, and many small and medium-sized enterprises were close to closing.

With China First Heavy Machinery Group Corporation, China Second Heavy Machinery Group Corporation, CITIC Heavy Industry Machinery Co., Ltd., Taiyuan Heavy Industry Co., Ltd., Northern Heavy Industry Group Co., Ltd., Dalian Heavy Industry Lifting Group, and Shanghai Heavy Machinery Factory Co., Ltd. “7 "Heavy machine" as the leading heavy machine industry is facing a severe test.

2013 was a more severe year for the heavy machinery industry. Data from January to May this year showed that the output value of the seven companies still did not improve, with the maximum decline reaching 28.58%.

Hard times

For the future, Wu Shengfu, a chairman of the board of directors, frankly stated: "The pressure is not small." At present, domestic and foreign companies are facing the problem of shrinking market and falling profits. Last year, the total assets of SMS Siemag were $6.442 billion, sales revenue was 5.907 billion U.S. dollars, and profit was 230 million U.S. dollars. The total assets of the company were 5.907 billion U.S. dollars, sales revenue was 1.309 billion U.S. dollars, and profit was 13 million U.S. dollars.

Last year, the sales of metallurgical equipment, nuclear energy equipment, heavy pressure vessels, large-scale castings and forgings, forging equipment, and mining equipment, which were mainly operated by one heavyweight, all fell. In 2012, due to the sluggish metallurgical market and the State Council's suspension of the approval of newly-built nuclear power projects, the company’s sales revenue for the year had a certain degree of decline from the previous year.

A related person introduced that from 2007, the production of the company began to decrease, and the output was maintained at RMB 12 billion. Ordering became more and more difficult.

The person introduced that the price of this year's orders and the volume of orders are falling. In particular, few steel projects, hot rolling, cold rolling have appeared saturated, aluminum rolling market this year has begun to decline, the stainless steel market is also saturated, the future market is not very optimistic, foreign market demand is also reduced.

In addition, the majority of foreign aluminum rolling is in third-world countries, they are not very familiar with the status quo in China, and it is difficult to accept our brand in the short-term.

The source also stated that 90% of domestic hydrogenation reactors for forge welding structures used by domestic petrochemical enterprises are produced in one batch. However, the profit of this product began to drop seriously last year.

From a workshop, nuclear power forgings are gradually starting to be launched. The person in charge of the workshop told the reporter that this is a previously stagnant task and that the orders for the next year will be started ahead of schedule to ensure that the production line is fully loaded. It is understood that since the nuclear accident of Japan's nuclear power plant on March 11th, the entire nuclear power industry was in a state of stagnation, and nuclear power had a major impact on the company.

In the workshop, the person also told the author that the entire nuclear power purchase order did not increase too much. He could only say that there was still some work. More companies respond to complete sets of equipment to make losses.

"Traditional Manufacturing" Changes

The bad market is the predicament faced by the entire industry. Comparing with internationally advanced companies, a responsible person thinks that leading heavy machine companies are in trouble because of their own reasons: First, the company's products are relatively single. GE, Inc. of the United States is involved in energy, aviation, medical, transportation, finance, home and business solutions. The emphasis is on industrial equipment, which involves energy equipment and equipment basic materials, and environmental protection equipment is at an early stage.

Second, China's heavy machinery enterprises do not yet have the capability of a comprehensive system solution. SMS Siemag has technology, standards, design and technical services. Only one has the manufacturing capacity. Therefore, the characteristics of manufacturing enterprises have not changed much. In the world's equipment manufacturing system, we can only do the lowest-end work in the value chain—manufacturing, and be in a dilemma of “working for a living”. In addition, the basic production characteristics of traditional manufacturing enterprises are still single small batches, single parts without approval, and the modern industry requires a "professionalization, automation, information, flow," the production of a far cry from, resulting in the production efficiency low.

In addition, the international operation of heavy machinery in China has just begun. Doosan Corporation's sales in Korea cover more than 30 countries; GE companies in the United States cover more than 100 countries around the world; business accounts for 50%. Only a few countries are involved in a foreign business; business accounts for 7%.

In terms of talent structure, the proportion of blue-collar workers in international advanced enterprises is 3:7, and the ratio of blue-collar workers is 7:3.

In view of the current industry deficiencies, Wu Shengfu, chairman of China First Heavy, said: “At present, world-class equipment companies are providers of system solutions, and we are still just a manufacturer, and are at the low end of the industry chain. End, companies will not have a good life."

Therefore, he put forward the "eight-pronged change" road for the future development of the company: the direction of development shifts from manufacturing to manufacturing and service; the shift from product equipment to energy equipment, industrial equipment, environmental protection equipment and equipment basic materials; From the domestic market to the domestic and international markets, the sector focuses on changing; the business scope shifts from asset management to asset and capital management; and the production process shifts from small batches to production specialization, automation, informationization, flow, and greenization. The management model has changed from a factory-based system to a group-based system, a divisional system, and an internal market-based system; the business field has evolved from equipment manufacturing to other areas; the growth pattern has changed from extensive growth to intrinsic growth.

Needs policy support

In response to the current problems of the company, the following recommendations were made:

First, we must focus not only on small and micro enterprises but also on large and medium-sized enterprises. For example, Dalian Heavy Machinery Co., Ltd. has a total of more than 50 small-sized enterprises. If Dalian Heavy Machinery fails, these companies cannot live. Large enterprises have a pulling effect on economic and social development. The state can formulate guidelines for the development of heavy equipment manufacturing planning and focus on building one or two international-type group companies.

Second, it is hoped that the first (sets) of domestically-identified equipment, the risk compensation mechanism for use, and the development of compensation measures for development will be introduced as soon as possible to support the development of major technical equipment for the first set of heavy machinery.

At the same time, it is recommended that the proportion of technical reform investment support in the national industrial policy be increased to 30% to 50%. At the same time, major technical equipment related to national security should be given a policy of extending the equipment depreciation period. And let major technology and equipment enterprises enter the military high-end research and development fields, give play to the advantages and capabilities of these leading enterprises in the civilian field, and contribute to the development of national defense construction.