Help me translate into fluent English: Dongwu Securities released a research report saying that the sales volume of the excavator industry in July was 12,606 units, a year-on-year decrease of 30%, of which domestic sales were 5,112 units, a year-on-year decrease of 45%; exports were 7,494 units, a year-on-year decrease of 14%. The bank believes that the overseas construction machinery market is in an upward cycle. Under the background of high export base, overseas supply chain recovery, and industry export data growth rate under pressure, it does not change the overseas growth trend. According to the construction machinery update cycle, the domestic market is expected to welcome a new round of update cycle in 2024-2025. The leading company is expected to gradually start its performance sailing this year. The main points are as follows:
July excavator sales volume year-on-year -30%, export stage pressure
In July 2023, the sales volume of the excavator industry was 12,606 units, a year-on-year decrease of 30%. Of which, domestic sales were 5,112 units, a year-on-year decrease of 45%; exports were 7,494 units, a year-on-year decrease of 14%. From January to July 2023, the cumulative sales volume of excavators was 121,424 units, a year-on-year decrease of 25%; of which domestic sales were 56,143 units, a year-on-year decrease of 44%; exports were 65,281 units, a year-on-year increase of 8%. Affected by the tight capital situation of downstream projects, the domestic sales decline of construction machinery in July was still large. From the perspective of real estate and infrastructure data, in June 2023, the new construction area of houses decreased by 30% year-on-year, and the real estate investment completion amount decreased by 21% year-on-year. The real estate construction heat did not rebound. In June, the infrastructure investment completion amount was 3 trillion yuan, a year-on-year increase of 12%, maintaining a high growth rate.
The overseas construction machinery market is in an upward cycle and the overseas growth logic continues
The bank believes that the overseas construction machinery market is in an upward cycle. Under the background of high export base, overseas supply chain recovery and industry export data growth rate under pressure, it does not change the overseas growth trend. In Q2 of 23rd century, Caterpillar, the overseas leader, achieved revenue of US$17.3 billion, a year-on-year increase of 22%, net profit of US$2.9 billion, a year-on-year increase of 75%, setting a historical record. The overall overseas construction machinery market is in an upward cycle. According to the ranking list of the top 50 global construction machinery manufacturers in
The overseas construction machinery market is in an upward cycle. The domestic market is expected to welcome a new round of update cycle in the next two years.
2022 (2022YellowTable), Caterpillar/Xugong Group/Sany Heavy Industry/Zoomlion’s revenue was US$32.1/18.1/16/10.4 billion respectively, with global market shares of 13.8%/7.8%/6.9%/4.5% respectively. The bank estimates that the overseas market share of domestic leaders is less than 5%, and there is a large space and trend for overseas market share.
Performance is expected to lead the industry recovery and gradually start performance sailing
Affected by high steel and shipping costs and reduced scale effects, etc., the profit margin of construction machinery enterprises dropped sharply in 2022. In 2023, the pressure of these factors will weaken and it is expected that the profit margin will start to recover. In 2022, the net profit margin of major domestic enterprises was only about 5%. Based on the current steel price level, the bank expects that major enterprises are expected to increase by about 3 percentage points in 2023, bringing more than 50% growth elasticity to profits. This year’s cranes and concrete machinery performed better than excavators. The sales structure of large excavators improved among domestic leaders. The export profit margin was higher than that in China. Under the background of significant decline in steel and other raw material prices, the bank judged that the profit growth rate > revenue growth rate > sales volume growth rate for construction machinery leaders . In addition, according to the construction machinery update cycle, the domestic market is expected to welcome a new round of update cycle in 2024-2025. The leading company is expected to gradually start its performance sailing this year.
