Analysis of Economic Operation of China's Machine Tool Industry in 2008

Abstract As the impact of the financial crisis spread across the globe, in 2008, China's machine tool industry's domestic sales and exports both showed a trend of first rise and then decline. In the first half of the year, they basically maintained steady growth. From the second half of the year, they entered the downward channel, and the fourth quarter. The post-growth rate is particularly significant. Enterprise...

With the spread of the global financial crisis in the global market, in 2008, China's machine tool industry's domestic sales and exports both showed a situation of first rise and then decline. In the first half of the year, they basically maintained steady growth. From the second half of the year, they entered the downward channel. After the fourth quarter, The decline in growth rate is particularly significant. Corporate profit growth declined for the first time and negative growth in the fourth quarter. However, overall production and sales and earnings have maintained a growth trend. As the market demand changes, the product structure of our industry is continuously optimized. Despite the market downturn, the inertia of the continued rapid growth of investment in the machine tool industry in recent years continued in 2009.

1. Production and sales grew steadily in the first half of the year, and entered the downtrend channel in the second half
From January to November 2008, China's machine tool industry continued to maintain a relatively fast growth trend, but compared with 2007, the growth rate of industrial output value fell by 4 percentage points. The growth in the first half of the year laid the foundation for the rapid growth of the whole year. The growth rate slowed down in the second half of the year. After September, the growth rate slowed down. The monthly output of Jinchee Machine Tool has been continuously negatively growing since July. The annual product sales rate has been lower than that of 2007, and the inventory is still growing.

According to the National Bureau of Statistics data released by the machine tool industry, 2008 to November, 4811 the total industrial output value of enterprises 315.22 billion yuan, an increase of 29.9%, 4 percentage points lower than the same period in 2007; the machine tool industry sales output value 298.13 billion yuan, an increase of 28.5% over the same period of last year, 7 percentage points lower than the same period in 2007.

In the first half of 2008, the industry's total industrial output value increased by 34.8%, but the growth rate dropped by 7 percentage points during the three months from July to September. The growth rate in the two months from October to November further fell by nearly 7 percentage points. The gross industrial output value of the gold cutting machine industry increased by 28.2% from January to June. The growth rate in July-September slipped to 18.9%, and the increase in October-November was only 11.1%. The output of gold cutting machine tools began to decline negatively in the third quarter, and the monthly output in November decreased by 19.7%. The CNC gold-cutting machine saw a faster decline, with November production down 34.4% year-on-year, the largest monthly decline in the year.

From January to November, the sales rate of industrial products in the machine tool industry was 96.5%, a decrease of 0.7 percentage points year-on-year. In addition to the 1.2% increase in the sales rate of the small machinery industry, the sales of other seven small industries, including: gold cutting machine tools, forming machine tools, woodworking machine tools, machine tool accessories, measuring tools, abrasives and other metal processing machinery. Both showed a downward trend. According to the survey of some enterprises, the follow-up orders substantially reduced or no follow-up orders has become the biggest problem facing businesses.

In the current market environment, a large amount of inventory brings more difficulties to the production and operation of enterprises than ever before. According to the Association survey of key enterprises show that as of November, total finished goods inventory of 86 billion yuan, an increase of 22.5%, reducing the 043 million yuan over the end of October. Finished goods inventory in metal cutting machine tools reached 5.505 billion yuan, an increase of 21.3%, decreased by 2.6 billion yuan less than the end of 10; cutting the amount of inventory was 1.502 billion yuan, an increase of 18.8%; forming machine inventory 1.16 billion yuan, an increase of 32.1%; machine tool accessories inventory of 2.8 billion yuan, up 25.4 percent; electrical machines inventory of 1.5 billion yuan, an increase of 30.4%. From the data, limited production Yaku has been made - some effect, but still need to pay close attention to the market, inventory control, the flow of capital as soon as possible.

Second, changes in market demand to promote structural adjustment
The negative impact of the international financial crisis on China's economy has been expanding in recent months. Enterprises are facing a harsh living environment, and many general-purpose products for machine tools are slow-moving. Under the influence of the national stimulus economic policy, the industries of electric power, railway locomotive, aerospace, transportation and so on have become one of the few growth industries. The machine tool industry has developed and manufactured a large number of high, fine and large high-additions for these fields. Value products, gradually adjusted the product structure. The growth rate of China's machine tool output has declined rapidly, while the sales value has continued to grow, and the machine tool unit price and output value have been increasing. January to November, metal cutting machine tools production of 57.9 million units, up 0.2 percent; forming machine tool production was 136,000 units, down 7.3% year on year. The sales value of products in the gold cutting and forming machine industry increased by 18.3% and 24.9% respectively. According to the survey of key enterprises, as of November, the numerical control rate of output value of gold cutting machine tools and forming machine tools in 2009 was 47.5% and 46.9%, respectively, which increased by 3.1 and 5.4 percentage points respectively. It can be seen that the product structure of my industry is continuously optimized under the impetus of market demand.

However, what I need to pay attention to in the industry is that there is a crisis of excess in these hot-spot users. Therefore, even the product market for these areas has begun to change from the seller's market to the buyer's market, and the competition will become increasingly fierce.

Third, the structure of import and export products was further optimized, and the growth rate was higher, but gradually declined.
In 2008, the import and export of machine tools in China showed a situation of increasing first and then decreasing. In the third and fourth quarters, both import and export growth rates declined. Affected by the downturn in the international market and the continued strength of the renminbi, the export situation of China's machine tool tools in 2009 was very severe. The export of metal processing machine tools decreased from a month in August for four consecutive months. Machine tool exports from January to November were US$6.58 billion, up 40.9% year-on-year, and the growth rate dropped 5.0% from January to October. Among them, the export of metal processing machine tools was 1.94 billion US dollars, up 302% year-on-year, down 3.7 percentage points from January to October, down from 10.4 percentage points in the same period of 2007.

Despite the increasingly severe external environment, the proportion of CNC machine tools in China's metal processing machine exports has gradually increased, the proportion of low-value machine tools has gradually decreased, and the structure of machine tool export products has been optimized. From January to November, CNC machine tools accounted for 37.4% of the export of metal cutting machine tools, an increase of 4.1 percentage points year-on-year. Low-value products such as bench drills, sawing machines, grinders and polishers were exported at US$330 million, accounting for 24.3% of exports, down 9.6 percentage points year-on-year.

Since 2008, the export growth rate of metal processing machine tools has been lower than that of the same period of 2007. The monthly export value in November has been negative. The main products that drive China's rapid export growth are abrasives, cutting tools and machine tool parts. The total exports of these three types of products are 3.11 billion US dollars, accounting for 44.2% of the total exports of machine tools, and the contribution rate of export growth is 53.7%. Metal processing machines accounted for 29.4% of the total, and the export growth contribution rate was 23.5%.

In terms of imports, from January to November, the total import of machine tools reached US$11.35 billion, a year-on-year increase of 7.0%, and the growth rate dropped 32% from January to October. Metal processing machine tools account for more than 60% of the total import of machine tools, of which the processing center, grinding machine, special processing machine imports are ranked in the top three. From January to November, the import value of these three types of machine tools was 19.0, 9.1 and 700 million US dollars respectively, up 24.9%, 13.6% and 4.1%. At present, the state has increased the export tax rebate rate for some products in order to encourage exports, which will play a positive role in the export of enterprises in our industry. In the current foreign trade environment, trade frictions and disputes will inevitably increase. Many countries and regions will restrict trade restrictions on foreign export enterprises through various barriers or trade principles in order to protect their own countries and local enterprises. Therefore, companies should continue to focus on improving the added value of products and optimizing product structure. At the same time, we must seize the opportunity to continue to explore emerging markets, so as to ensure the steady growth of machine tool exports.

Fourth, profits continue to grow, the growth rate declines for the first time
Relying on the high growth in the first half of 2008, the machine tool industry achieved a profit of 17.67 billion yuan from January to November, a year-on-year increase of 18.2%, and the growth rate was 35 percentage points lower than the same period in 2007. In 2009, the growth rate of industry profit showed a rapid decline. The profit from January to February increased by 73.7% year-on-year; from March to May, it increased by 40.0%; from June to August, it increased by 22.1%, and from September to November, it decreased by 4.3%. From an industry perspective, the profit growth of the two small industries of gold cutting and forming machine tools was only 6.0% and 9.4%, and fell to the 1-digit growth rate for the first time; only the profit of foundry and abrasives was higher than the industry level. From the perspective of the nature of the enterprise, the total profits of Hong Kong, Macao and Taiwan and foreign-controlled enterprises all showed negative growth, at -17.3% and -7.3% respectively.

V. Investment inertia continues
In recent years, investment in the machine tool industry has continued to grow rapidly, and this inertia continues. From January to November, our industry has completed fixed assets investment of 70.88 billion yuan, a year-on-year increase of 48.5%; new fixed assets increased by 58.9% year-on-year, much higher than the national average. According to the data, the total planned investment is 166.22 billion yuan, and the follow-up investment is still 95.34 billion yuan. Enterprises should be cautious about expanding production capacity and launching large-scale machine tools. Make effective investment for the development of their own advantages products, identify the market positioning, business development and growth strength; put more money and effort to gradually narrow the gap between imports and products in personalized products, quality and service as well as high-end products work hard, enterprises can sustainable development.

In short, from the data point of view, the machine tool industry continued to grow in 2008, with a relatively high growth rate in the first half of the year, and a downward channel in the second half of the year. Domestic and foreign markets are affected by the financial crisis, companies lack of new orders, sales decreased, followed by increase in inventory, reduced profits, lack of working capital and other difficulties will be exacerbated in the last month. On this basis, expected in 2008, China's machine tool industry growth rate will remain at around 25%, industrial output value and sales value of over 330 billion yuan; metal cutting machine tool production in 2007 was flat at 600,000 units; including numerical control gold cutting machine tool production was slightly lower than 2007 levels, about 12 million units; metalworking machine tool imports at $ 7.4 billion and down, up less than 5%; exports will continue to decline year is expected to export about $ 7 billion, is likely to It is lower than the growth rate of 36% in 2007; the export volume of metal processing machine tools will exceed 2 billion US dollars, an increase of 25%.

At present, the state is striving to ensure the stable growth of the domestic economy, implementing a proactive fiscal policy and monetary policy, and launching key projects through new investment to stimulate the market. With the implementation of new projects in various user industries, especially the policy of stimulating automobile consumption, It will provide a broad market for the machine tool industry. At present, it is a good opportunity for the company to conduct deep market research, optimize product structure, develop demand products, rectify product quality, and improve corporate management. China's automobile manufacturing, transportation, national defense military, aerospace, clean energy, oil and gas exploration and transportation, engineering machinery, agricultural machinery and other industries import a large number of machine tools every year. Our industry enterprises should be deeply aware of their manufacturing processes and develop users to meet their needs. Importing alternative products for demand, thereby gaining space for their own development.

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