China into a dumping site for second-hand construction machinery?

According to statistics, currently 90% of imported second-hand excavators in the Chinese market are from mature countries with core technologies including construction machinery in Japan. In recent years, with the rapid development of the Chinese economy, there are many construction sites throughout the country. If you go to the construction site and turn around, you will find that many construction machinery products with LOGOs such as Caterpillar, Komatsu, Hitachi, etc. are in service. Most of these construction machines are used equipment that has been eliminated from abroad. The price/performance ratio is higher than that of domestic products, and it is much welcomed by the market. Why is China the dumping ground for foreign used construction machinery market?

High cost performance by the favor

Why do users not use domestic new machines and have to buy out products from abroad? According to industry insiders, foreign environmental awareness is very strong and there are strict controls on used equipment. A new general-purpose mechanical excavator, working hours of more than 5,000 hours, then it will be sent to excavator brand service points to maintain, but a lot of excavators, especially small excavators, they are mainly used to flat Soil, and occasionally digging pits, so that excavators in Europe and the United States, Korea, Japan is very "happy", basically did not do anything heavy!

Secondly, most foreign construction machinery parts have a long production history, mature technology, adequate supply, high production concentration, and prominent brand effects. The development of kits has evolved with the development of the mainframe. At the same time, the development of the kit itself has in turn promoted the development of the mainframe. At the same time, mainframe manufacturing companies are gradually developing towards the direction of assembly companies, and parts are gradually being provided by suppliers. Caterpillar, Case, Japan's Komatsu, Sweden The world's major manufacturers of such large-scale engineering machinery manufacturers are widely used by Volvo. Relative to the domestic market, the production of supporting parts for construction machinery started relatively late. The shortage of technology, decentralized production, and weak brand effect have become the bottleneck restricting the development of mainframes. Therefore, some engineering machinery and equipment periodically eliminated by Europe, the United States, Japan and South Korea, especially Japan's 80% of the eliminated equipment have been transferred to China.

In addition, the domestic users are mainly self-employed. They prefer the advantages of price and quality. It is precisely because the foreign second mobile phone has advantages in quality and price over domestic products, and therefore has been widely welcomed by users.

Market confusion

Due to the low price of second-hand construction machinery or the short-term needs of construction, a considerable number of cities in China gradually formed a distribution center for second-hand construction machinery trade. It can be said that second-hand equipment not only undertakes the two major businesses of construction machinery financing leasing and remanufacturing, but also relates to the cash flow, operating risks, and continuous profitability of manufacturers and agents. At present, the sales channels for second-hand construction machinery are generally divided into three types: the first is internal digestion by the dealers' own channels; the second is through the two mobile phone distribution markets of Xushui, Qingzhou, Tianjin, and Shenzhen; and the third is the use of , Ritchie Bros. and other third-party platforms for auction. Regardless of the mode, the pricing of second-hand equipment remains the industry's “water deepest” area.

As the domestic market for second-hand construction machinery is not standardized enough, the valuation and after-sales system of second-hand equipment is also not perfect, coupled with the quality of local brands and life cycle issues, users do not recognize domestically produced second-hand mobile phones. Instead, foreign mobile phones have flooded into the domestic market. A more reliable figure comes from customs statistics. In 2011, more than 30,000 second engineering machinery and equipment were imported into China; together with various debt machines and creditor machines, although the specific numbers of second-hand construction machinery lacked detailed statistics, the number and size of It should be quite "significant."

China still lacks a perfect second-rate mobile phone evaluation standard. It can only make judgments based on the use of machinery and equipment, average annual usage time, overhaul periods of the engine and hydraulic pump, and operating conditions. It is easy to appear as a private benefit for various black-box operations. The behavior of the entire mobile phone market, thus affecting the healthy and orderly development. To address this situation, it is necessary to establish an objective, fair and honest third-party assessment agency on the one hand, and on the other hand, it can also use foreign experience to promote open and fair auction models. At present, more than 80% of domestic second-hand equipment transactions are private transactions. This situation is really worrying.

Impact on the domestic market

Unlike the scattered institutions that operated domestically-used second-hand machinery, the Ritchie Bros. Auctioneers acted as the world's largest industrial auction company with offices in 25 countries around the world. On April 18, 2013, the Ritchie Bros. Auctioneer held its first open-price auction in China in Beijing. The Ritchie Bros. Auctioneers accepted commissioned goods from all over the world, including the Kato HD820V hydraulic excavator manufactured in 2010 and Caterpillar 320D-E hydraulic excavator produced in 2009. All auctioned on the auction. According to participants in the industry, the price of second-hand equipment in this auction is generally only 30% to 50% of the new machine. The source believes that it is precisely because of the low price that imported second-hand machinery occupies a part of the market share. Taking 2011 as an example, the total excavator sales in the market exceeded 170,000 units, while the sales of new brands of self-owned brand excavators accounted for 39.11% of the total. The proportion of used excavators reached about 14.25%. According to industry insiders, the global platform and leverage of Eli's brothers' auction houses, along with the expansion of their business in China, will bring more used equipment from around the world into the country.

It is reported that the market holding capacity of second-hand construction machinery currently used in domestic construction machinery has exceeded 5 million units. By 2015, the annual sales volume of construction machinery will reach more than 1 million units. According to the life cycle of mechanical equipment, it is estimated that by 2020, the annual number of scrapped construction machinery will be as high as 1.2 million units.

Although it is generally believed that the overhaul and replacement period of construction machinery is between 5 and 8 years, in the last two years, with the shrinking of the engineering volume and the trade-in operations carried out by various manufacturers, a large number of 2 to 3 years of equipment have also entered the secondary market; In 2010, customers influxed into the industry began to enter the market with equipment purchased through mortgages and financing leases. At the same time, foreign-imported second-hand equipment began to enter the domestic market on a large scale. In the Beijing market alone, there are currently 2,000 new excavator trucks and 4,000 used machineries. According to statistics from the National Equipment Rental and Used Equipment Professional Committee, by the end of 2010, the transaction volume of used equipment for construction machinery in China had exceeded 100 billion yuan, and the transaction volume exceeded an astonishing 5 million units.

At present, China's construction machinery industry has entered an era of low- and medium-growth growth. The problem of destocking and overcapacity is beginning to become apparent. The most serious problem in the construction machinery industry is still destocking. If there is no restriction and supervision on the imported second-hand construction machinery market at this time, domestic brand manufacturers may be affected.

Enterprises call for restrictions on supervision

In fact, the controversy over whether to strictly restrict the import of second-hand machinery has emerged many times in China. Su Zimeng, secretary general of the China Construction Machinery Industry Association, also expressed concern on various occasions. In addition, presidents of Sany Heavy Industries Xiang Wenbo, chairman of the supervisory board of Zoomlion Long Guojian, and chairman of Sunward Smart, He Qinghua, etc., also issued from time to time. Limit the sound of imported second-hand construction machinery and equipment.

Su Zimeng, secretary-general of the China Construction Machinery Industry Association, stated that the state should adjust the import management policy for second-hand construction machinery, especially for the manufacture of more than five years, the discharge is seriously excessive, the energy consumption is obviously too large, and the import of used equipment with potential safety problems is to be carried out. strict control.

President of Sany Heavy Industry Xiang Wenbo publicly stated on Weibo that if China continues to impose no restrictions or strengthen supervision on imported second-hand construction machinery, China may gradually become a dumping ground for these imported second-hand machinery.

Long Guojian, chairman of the Supervisory Board of Zoomlion, stated that in addition to protecting national industries, the restriction and supervision of imported second-hand machinery is also aimed at safeguarding the interests of domestic consumers. Imported second-hand machinery is not as good as domestic new machines in terms of durability and applicability. The most important thing is that after-sales service cannot be guaranteed. In addition, the regulatory gaps have also led to many devices that do not meet the import standards and have been able to enter the domestic market, especially high energy consumption and high pollution equipment.

Shanhe Intelligence Director Cai Guangyun stated that if the market is already in surplus, then the foreign imports of second-hand construction machinery will be released, and domestic brands will certainly be hit, even delaying the pace of recovery and development of domestic construction machinery companies. ”

Wang Jizhong, chairman of Great Wall Machinery, stated that the lack of professional identification capabilities for the purchase of second-hand equipment by the customers, and after the merchants shoddy, discovered that the parts of the hydraulic system were seriously worn out, the volumetric efficiency was reduced, and the machine performance was greatly reduced. In addition, there is no after-sale "Three Guarantees" service. In the event of a failure, maintenance costs and component purchase costs remain high.

Multi-pronged approach to standard
In the face of the large demand for the secondary market, a second-hand construction machinery trading platform that is characterized by trust, formality, strict supervision, adequate equipment, and more transparency has become an increasingly urgent problem.

Based on the current confusion in the trading of products in the used equipment market and the fact that imported equipment is also mixed, the relevant state departments have issued a series of regulations in recent years to regulate them. For example, the "General Rules for Circulation of Used Equipment" was formally implemented on March 1, 2010. The "General Rules" set forth the requirements for the terms, definitions, classifications, quality, appraisal, assessment, evaluation process, and transactions of used equipment circulation.

Up to now, four domestic trade industry standards such as "Second-hand Excavator Circulation Requirements", "Second-hand Loader Circulation Requirements", "Secondary Concrete Pump Circulation Requirements" and "Second-hand Mobile Crane Circulation Requirements" have been formed. Review the manuscript and submit it to the relevant national department for review.

51 domestic trade industry standards such as the use of regional large-scale renewable resource recycling and construction management specifications for second-hand construction machinery have been reviewed by the Ministry of Commerce, including the technical requirements for second-hand forklifts, the technical requirements for second-hand asphalt mixing equipment, and the technical specifications for second-hand asphalt mixing equipment. The rules will be formally implemented on July 1, 2013.

Such frequent introduction of industry standards and regulations is evident in the importance attached to the secondary market for construction machinery. However, based on the various problems exposed in the current secondary market, it is not enough to focus on the healthy and orderly development of the market. For a well-advanced market, there are only laws and regulations that do not work. There should also be relatively perfect quality appraisal agencies and professional practitioners, who should materialize the standards written on paper and regulate the development of the industry with actions.

As early as 2006, China Construction Machinery Industry Association Nanjing Training Base began the training of first-hand second-hand (hydraulic) excavator appraisers in China. Since then, it has created China's first batch of second-hand excavator appraisers, although only 13 people are qualified for evaluation. However, this has given a good start to the assessment of the quality of used construction machinery. There is a large demand for professional second-hand appraisers, and various professional appraisal organizations are increasingly popular.

At the same time, as a third-party evaluation agency, its authority, impartiality, and credibility are also the focus of further standardization; for assessing the industry's market access standards, the accreditation qualification assessment is also the key to improvement.

Conclusion:

Although the domestic used machinery market has long been a coveted meat and fat of many domestic and foreign businesses, how to properly guide operations is still at the stage of exploration. Compared with developed countries, there are still differences in the level of development of the secondary construction machinery market in China. The order of circulation is confusing and the quality of equipment is not well protected and after-sales service. However, with the gradual improvement of the second-hand market trading system and the continuous strengthening of the state's supervision of the secondary market, we will surely usher in a more healthy and orderly development of the secondary market for construction machinery. At the same time, while strengthening the existing technological innovations, domestic construction machinery companies should also strengthen customer service and maintenance, better respond to customers, and create convenience for customers, in order to win customers, blindly rely on national protection, national Support has no future.