China produces 40% of the machinery on the earth, the Germany Machinery Association says

[GS Zhou]

China produces 40% of the machinery on the earth, the Germany Machinery Association says

According to a new report released by VDMA (Germany Machinery Industry Association), global machine sales (without services) dropped by a nominal 1 percent to 2,530 billion euros in 2016. However, the result was also strongly influenced by exchange rate effects; when adjusted for prices and exchange rates, world machine sales showed a small increase in sales by 1 percent.

According to the VDMA report, China maintained its leading position by a clear margin (2x bigger than No.2 country), remaining the world's largest machine manufacturer in 2016, with an overall turnover of 964 billion euros (~40% of world total machinery output)

World Machinery Industry Size, in billion Euro

Output value of Top 10 Machinery Manufacturing Countries, data in billion Euro
(From Top to Bottom: China, USA, Germany, Japan, Italy, South Korea, France, India, UK, Holland)

@TaiShang @cirr @ahojunk @long_ @JSCh @terranMarine @onebyone

 

[dy1022]

China is larger than USA+Germany+Japan+SK combined.

Same as industry output at the end of 2016.

China as the largest industry nation on earth with billion+ PP, never ever seem it before in Human history!

 

[terranMarine]

Totally the opposite of US Defense. Man what a Juggernaut

 

[cirr]

By value.

How about by volume?

We all know that China likes to sell its machines at competitve prices.

 

[Shotgunner51]

964 billion euros (~40% of world total machinery output)

So machine is a $1 trillion economy in China, good news!

Now 40% of world, IMO as industrial base continue to expand/upgrade, it should go 50%+ (larger than rest-of-the-world combined) soon, just like other sectors say steel, aluminium, copper, fiber optic, PC, mobile, electrical appliances ...... and such.

By value.

How about by volume?

We all know that China likes to sell its machines at competitve prices.

Given competitive prices and currency factor, IMO by volume share should be even bigger than 40%. But machinery sector is highly diversified (in types, sizes, techs, unit value), so it's hard to find standard unit.

In sub-sector like machine tool (includes CNC, "crown jewel of all machines"), machines are diversified, so perhaps value is still a common unit. See this:

https://defence.pk/pdf/threads/gard...e-tool-survey-data-ranking-by-country.468126/

 

[Beny Karachun]

That's a $1 trillion economy in China, good news. Now 40%, IMO as industrial base continue to upgrade, China machinery sector should be larger than rest-of-the-world combined soon, like other sectors say steel, aluminium, copper, fiber optic, PC, mobile, electrical appliances and such.

Trump wants to change that

 

[Shotgunner51]

Trump wants to change that

I agree with you, the US administration may want that change. However IMO the status quo, the momentum, can't be changed in short time. China and US are two fundamentally different nations, if not entirely opposite:

• From GDP by sector, China is far bigger in industrial sector, while US is far bigger in services, economic structure is completely opposite. Industrial complex in China is not just huge in nominal value, more importantly it's very deep in supply chain, and wide across most if not all sub-sectors. US industrial base though small, but it can rely on imports from Japan (machine tools, precision components, advanced alloy, composites), Germany (machine tools, precision machinery, chemical) or SK (chemical, semiconductor) in hi-tech supply chain, a high purchasing power of dollar also helps imports.

• US is a high consumption low savings economy, China is exactly opposite. The ultra high savings in China is the principal factor (and to a lesser degree inbound FDI, of which almost 80% from Hong Kong) in driving up domestic investment, which then creates a huge demand for capital goods, like machinery. Though machinery is already a key pillar in Chinese exports, domestic demand for a variety of machinery is so massive that China even has to import from other industrial nations (check CNC and Robotics trade with Japan, Germany, SK; See below machine tool consumption as an example). High investments, hence huge demand for machinery, is one major characteristic of China economy.

• A science and industrious culture. From school education to career training, priorities for the populace are science, mathematics, engineering as well as technical-vocational skills. The China society (universities, national programs like 863 and such, corporations, individuals) invests huge resources on R&D (world #2 in nominal value), fast rising in science fields, already world's #1 patent filer since 2010, even on a per capita basis China has risen to world #6. A skillful, knowledgeable, disciplined and ambitious workforce with a strong will to succeed is critical to an industrial economy.

 

[武成王]

A good portion of machine tool made in China are low to middle end. There's a long way to go to catch up JP or DE vendors in engineering excellence. There're lots of problems in manufacture industry of China. A lot of first class talents have no any interest in manufactures. Some business owners are often short sighted and intend to earn only quick money. The first line works may have little passion and slipshod in work. The only thing positive is scale, a bargain chip to force JP or DE vendors to lower price of their high end products.

 

[Place Of Space]

By value.

How about by volume?

We all know that China likes to sell its machines at competitve prices.

The situation changes. As the technology is improved, machines' price will raise.

 

[TaiShang]

A good portion of machine tool made in China are low to middle end. There's a long way to go to catch up JP or DE vendors in engineering excellence. There're lots of problems in manufacture industry of China. A lot of first class talents have no any interest in manufactures. Some business owners are often short sighted and intend to earn only quick money. The first line works may have little passion and slipshod in work. The only thing positive is scale, a bargain chip to force JP or DE vendors to lower price of their high end products.

The fact is that China dominates the global machinery production and export, this is quite a success for a developing that continues to develop in leaps.

It is true that China lacks leadership in some aspects of machinery industry such as software and automated robotics, but, there are huge investment in these areas, as per the 13th 5-Year Plan.

It is nonetheless critical to be cognizant of one's deficiencies to seek improvement.

 

[GS Zhou]

By value.

How about by volume?

We all know that China likes to sell its machines at competitve prices.

Given competitive prices and currency factor, IMO by volume share should be higher than 40%

Volume wise I bet China's share is larger than 50% already, i.e. China>ROW. The prices of western machinery is too much hyped by the so-called brand images, or brand reputation. For similar machinery China vs. western countries, price of the China-made unit is usually half to that made by westerners.

For example,
- Excavator, the Sany excavator is priced at about RMB 700k to 800k, but a Komatsu unit needs RMB 1,300k at least;
- Wheeled-loader, a Liugong loader priced at about RMB 350k, but a Caterpillar unit needs RMB 1,500k at least;
- Heavy duty truck, e.g. a 50ton tractor truck, a FAW Jiefang truck needs about RMB 320k, but a MAN truck needs RMB 900k at least.

I'm actually a bit surprised that even from the value perspective, China could hold 40% share global wise!! That's a great great figure.

 

[Shotgunner51]

Volume wise I bet China's share is larger than 50% already, i.e. China>ROW. The prices of western machinery is too much hyped by the so-called brand images, or brand reputation. For similar machinery China vs. western countries, price of the China-made unit is usually half to that made by westerners.

For example,
- Excavator, the Sany excavator is priced at about RMB 700k to 800k, but a Komatsu unit needs RMB 1,300k at least;
- Wheeled-loader, a Liugong loader priced at about RMB 350k, but a Caterpillar unit needs RMB 1,500k at least;
- Heavy duty truck, e.g. a 50ton tractor truck, a FAW Jiefang truck needs about RMB 320k, but a MAN truck needs RMB 900k at least.

I'm actually a bit surprised that even from the value perspective, China could hold 40% share global wise!! That's a great great figure.

Agree, share is already 40% by nominal value, then volume-wise share should be higher. On cross-border comparison between unit prices, currency advantage of RMB is always instrumental. SANY, Liugong, FAW, Shenyang Machine Tool, Midea are some good companies.

It is nonetheless critical to be cognizant of one's deficiencies to seek improvement.

Yes, machines differ in sizes, in fact the smaller the harder to make. China is definitely good in heavy equipment (there's a thread here about BIG equipment), say ZPMC alone dominates 80-90% of global market in port machinery, but say on CNC machine tools (especially sub-micron levels) which are dubbed "crown jewel" of all machines, China is yet to catch up with Japan and Germany, and don't forget the area of advanced robotics. Though Japan and Germany overall scale is like a small fraction of China's, but there are Fanuc, Yamazaki Mazk, Yaskawa, Siemens, DMG, Kuka (though acquired by Guangdong Midea, it's Germany-based) and such, I wish more Chinese machine corporations will become as competitive if not even more.

 

[SBUS-CXK]

Decoupling: China Overtakes Germany as Russia's Main Machine Imports Supplier

For the first time ever, China's annual machinery exports to Russia exceeded those of Germany, fresh 2016 figures from Germany's Mechanical Engineering Industry Association (VDMA) revealed Tuesday.

It reported that China delivered machinery worth 4.9 billion euros ($5.2 billion) to Russia last year, compared with orders from Germany totaling 4.4 billion euros.

The trend reversal had been expected following EU economic sanctions imposed against Russia over its perceived role in the Ukraine conflict and the annexation of Crimea.

"Chinese suppliers are clearly at an advantage at the moment," VDMA's Monika Hollacher said in a statement. "They don't have to grapple with any sanctions and, when needed, provide their own financing offers to boot."

http://russia-insider.com/en/decoup...russias-main-machine-imports-supplier/ri19577

 

[Viet]

interesting. but I have yet to see China made machines in Germany. more interesting. when I look at alibaba for VN made machines, I see 30,144 results.

https://www.alibaba.com/countrysearch/VN/machine.html

Regardless congrats

 

[Bussard Ramjet]

By value.

How about by volume?

We all know that China likes to sell its machines at competitve prices.

More than value, you should look at technology and quality.

The high end market for machine tools is totally dominated by Germany and Japan.