The sales revenue of the construction industry increased from CNY 11,773.42 billion in 2011 to CNY 18,075.75 billion in 2015 with a declining annual growth rate, which is consistent with the overall economic trend in China.
The output volume of Chinese excavators decreased from 194.961 thousand in 2011 to 92.592 thousand in 2015 mainly for the saturation of the excavator market and the slump growth of new constructions.
According to CRI, major purchasers of excavators include construction units, mining ones and some individuals. With the yearly increase of manpower costs, most construction units use excavators instead of manpower to perform the mechanical work. The demand of the mining industry for excavators increases for rising manpower costs and personnel safety problems. Meanwhile, Chinese government speeds up the construction of urbanization and infrastructure. Most construction units outsource part of projects to individuals to reduce the investment in fixed assets and personnel, which also leads to a higher demand for engineering machinery like excavators.
Chinese government restructures the economy and supports the development of the construction machinery industry. In the process of urbanization, the construction and planning of infrastructures increase the demand for excavators as well. The excavator manufacturers improve the procurement industry chain in the globe, which effectively enhances the development of the overall market.
In terms of competition, brands of Japan and South Korea dominated Chinese excavator market before 2010, which was followed by that of Europe, the U.S.A. and China. However, the market structure transferred from 2010 to 2015, and Chinese brands became dominants while market shares of Europe and the U.S.A. brands shrank and Japan and South Korea Brands lost major shares. Meanwhile, excavators of Chinese brands remain dominants. According to CRI, the aggregate market shares of the sales volume of top 5 excavator manufacturers was about 50% in China in 2015, while there was certain development space of this market for some small and medium-sized enterprises.