On July 30, 2020, with the; In the post pandemic era, how can agents seek survival and change their mindset; The 2020 China Construction Machinery Elite Agent Hotspot Forum with the theme was held grandly in Tianjin. The forum was hosted by Jiangke Construction Machinery Media and organized by Beijing Hengri Construction Machinery Co., Ltd. This forum brings together China's elite agents and industry experts to achieve innovative linkage between online and offline channels for the first time, jointly exploring how to revitalize the channel value of China's construction machinery agents in the post pandemic era and pave the way for the sustainable development of the agent group.
  Qi Jun, President of China Construction Machinery Industry Association        At the meeting, Qi Jun, President of the China Construction Machinery Industry Association, gave a keynote speech titled "Analysis of the Trend of China's Construction Machinery Industry in 2020". Starting from the macro perspective of the industry as a whole, he analyzed the current situation and development trend of the construction machinery market, providing reference for the market strategic decision-making of the next agent group.
        1、 Review of the Operation Status of the Construction Machinery Industry in 2019 and the First Half of 2020
        In 2019, China's construction machinery industry achieved a revenue of 668.1 billion yuan, a year-on-year increase of 12% compared to 2018, ranking among the top in the machinery manufacturing industry.
    In 2019, the total revenue of 12 enterprise groups in the industry reached 396.8 billion yuan, a year-on-year increase of 20%. The total revenue of these 12 host manufacturing enterprises accounted for 60% of the entire industry.
        In the first half of 2020, the sales volume of 12 major construction machinery products included in the statistics increased by 14.4% year-on-year, and the export sales volume increased by 2.06% year-on-year.
        From January to June this year, 12 enterprise groups in the industry achieved a revenue of 202.4 billion yuan, a year-on-year increase of 15.4%, a profit of 18 billion yuan, a year-on-year increase of 15.9%, and a corporate profit margin of 8.9%. The average profit of 12 enterprise groups is 6% higher than the industry average.
        2、 The short-term and long-term impact of the epidemic on the construction machinery industry
        In the first half of this year, according to the association's statistics, due to poor funding support in various regions, the overall infrastructure construction rate was insufficient, and the overall construction machinery stock rate was not high. The COVID-19 pandemic has brought short-term adverse effects to both the upstream and downstream of the construction machinery industry.
        Throughout the first half of the year, the impact of overseas epidemics on the domestic supply chain was not significant. On the one hand, at the end of last year, the reserve of components from the host factory was sufficient and could be maintained until the second quarter of this year. In the second quarter, the overseas supply chain system has basically returned to normal. From January to June, the overall export growth rate of the entire industry declined, but excavator exports showed a recovery growth. Excavator exports increased by 17.8% from January to June.
        In order to offset the negative impact of COVID-19 on the national economy, the government increased investment in infrastructure construction, effectively stimulating the demand for construction machinery. In the second quarter, China's construction machinery industry achieved a counter trend growth.
        Based on environmental and investment policies, Qi Jun has given positive expectations for the Chinese construction machinery market in the next five years.
        In terms of environmental protection, against the backdrop of intensified environmental control measures for non road mobile machinery nationwide; The 14th Five Year Plan; During this period, the four stage emission standards for non road machinery will be introduced, urging high emission old equipment to exit the stock market. The relevant machinery manufacturing industry will strive for more buffer time for engine and host manufacturing enterprises in the process of communicating with the national environmental protection. It is expected that engine companies will have an 18 month preparation period after the release of the National IV standard technology roadmap; On this basis, the host factory will reserve an additional six-month buffer period.
        In addition, based on the normalization of the COVID-19 epidemic, domestic investment will become one of the main driving forces for economic growth.
        Therefore, according to the Chinese construction machinery industry's; The 14th Five Year Plan; According to the plan, it is expected that the industry's average annual growth rate will reach 5% from 2021 to 2025.
        3、 Agency channel losses in the context of excavator industry growth
        In the context of the rapid rebound of China's construction machinery industry after the epidemic, the production and sales of excavators have achieved unexpected growth, but many excavator agents are facing losses, especially in the small excavator market. At the same time, this non market competitive behavior and means are affecting the medium and large-scale mining markets, which will have a negative impact on the entire industry.
        In this regard, host companies have also recognized the seriousness of the problem and are actively taking measures. It is reported that major host manufacturers have completed the profit rebate work for agents in the first half of the year, with a total rebate amount of 2 billion yuan for some enterprises, increasing subsidies for agents.
        The growth of the excavator market in the future will definitely have a ceiling, and agents need to hold their bottom line and not enter a bottleneck period like the white goods industry.
        4、 Survival and Development of Agents in the Post Pandemic Era
        Agents have reached the stage of preparing and making efforts in the aftermarket, which is the main part of future profits, even accounting for 80%. The growth of new machine sales is only the maintenance of channels. Which agent can hold onto old customers and make an impact on the existing market, which can ensure sustainable development in the next stage.
        In terms of brand competition, some brands will definitely exit the market. With the decline in sales of new machines, the integration of many brand agent regions will accelerate in the future. Both agents and host factories face a two-way choice. Agents need to prioritize the survival of their own enterprises and identify which host factory development models are sustainable.
Preventing and controlling the epidemic will be the top priority of our work in the second half of this year. Without the health and safety of employees in our agency companies, there can be no survival and development of the entire enterprise. Agents should focus on laying out the aftermarket, increasing its penetration rate, using services to maintain relationships with customers, and maximizing the core value of our agency channels.