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Strong rise of Foundry mould "China manufacture"

Public date: 2017/8/7 16:44:23

Germany is a teacher in China's manufacturing industry. A hundred years ago, a hundred years later, it is still. In a variety of exquisite German manufacturing pictures, people are exclamation of the German high precision technology, the professional quality of workers, that is the high-end manufacturing industry "chemical".

The domestic machinery manufacturing industry in Germany had a good time. The rapidly growing competitors from China pose a serious threat to the strong position of German enterprises in the world market in this field.

Chinese enterprises are strong in European market

German media said that the machinery manufacturing industry is a model industry, one of the pillars of Germany's national economy, and has benefited from prosperous export business in the past few years. Industry experts warned German manufacturers not to rest easy because of the strong export. In fact, according to an analysis by the Boston consulting company, Chinese companies have promoted the growth of machinery manufacturing worldwide in the past few years: the share of Chinese companies in the world market increased from 23% in 2008 to 37% in 2012 - more than 50% in only 4 years.

It is reported that this growth obviously has an adverse effect on German manufacturers: its share in the world market has dropped from 12% to 9% in the same period. The author of the report wrote: "European machinery manufacturers must be aware that the competitive environment has changed and must respond to the more obvious threats, otherwise they will be knocked down by aggressive challengers from China."

Experts from Boston consulting company believe that Chinese manufacturers mainly benefit from China's large number of cheap labor and high production. High production makes their production cheaper. The high demand in the domestic market and the support of Chinese government have also helped Chinese enterprises. The advantage is reflected in the report's data: from 2006 to 2011, it was said that Chinese machinery manufacturers' share in the global construction machinery market increased from 3% to 15%, an increase of 4 times.

The rising industry promotes the rise of Chinese producers

What's more impressive is the development of telecom equipment and wind turbine manufacturers: their share in the global market has increased from a few percent to about 25%.

It is believed that the rapid development of emerging markets has also promoted the rise of Chinese producers. Although many customers in these markets don't want the cheapest machine, they also value the cheap price and are willing to sacrifice the quality for it.

The reports say that Chinese manufacturers offer products to this segment between cheap products and expensive high-tech products, usually from Germany, and have achieved great success. Nicholas Ron, a senior partner at Boston consulting, warned that it also had an impact on market share: "German companies are already lagging behind Chinese rivals in the most threatened industries in the field of mechanical manufacturing, especially in fast growing emerging markets."

Loss of market share of German machinery dealers

German machinery manufacturers should also be afraid that Chinese competitors have substantially increased their market share in Europe: from 2008 to 2012, China sold 23% of the traditional machinery, optical and electronic products to EU countries (except Germany). In the same period, German manufacturers lost their business there: their products sold in other European Union countries were reduced by 4%.

Ralph Moldenhauer, a partner of Boston consulting company and a business strategy development expert, believes that this opposite trend will continue. "Chinese companies will continue to invest in scientific research, and will provide more high-value products in the future and continue to actively buy enterprises in the mature market to obtain technology, brand and market."

He and his colleagues have identified 18 sub industries that are particularly threatened by Chinese competitors in the field of mechanical manufacturing. The list ranges from measuring technology and medical technology to welding machine.

It is reported that in four sub industries, Chinese manufacturers have replaced the market leading position of German rivals, including data processing machines, electronic circuits and casting moulds.

The German machinery and equipment manufacturers association also warned China's competitors' ambitions. Reinhold Festeg, chairman of the association, said: "German companies cannot be pushed down the top of technology Pyramid."

However, Chinese enterprises are rising with the support of the government in the field of high technology, so they are directly competing with German mechanical manufacturers.

The report also said that Chinese manufacturers are strong in the so-called low and middle technology field, and have been leading German manufacturers in some ways. In the long run, Chinese competitors can accumulate experience in this field and prepare for entering the higher demand technology field.


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