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Construction Machinery Industry Will Maintain the Upward Trend in the Next 10 Years By Lanbo Jiang

  in Advice | Published 2010-02-28 12:30:56 | 187 Reads | Unrated

Summary

Experts expected that with the market demand after a brief pulse low following its growth rate will continue to improve Of course, the extent of the industry and the inflection point occurred callback time, depends on the follow up implementation of the national macro control efforts and related ind ustries are affected

Full Content

Experts expected that with the market demand after a brief pulse low following its growth rate will continue to improve. Of course, the extent of the industry and the inflection point occurred callback time, depends on the follow up implementation of the national macro control efforts and related industries are affected.

Domestic manufacturers used the "price adjustment" means in fact is to make a lot of industries and businesses have headache. On the one hand, manufacturers kept emphasizing that prices of raw materials, products, higher manufacturing costs; the other hand, the
industrialists in the use of a variety of promotions to attract customers. The result is falling instead of rising prices. The main cause of this result is rooted in China's construction machinery homogenization there is a serious problem.

Analysts believe that domestic enterprises and foreign enterprises biggest difference lies in the different business objectives, foreign enterprises to "maximize profits" as the goal, while the domestic companies is more of a "market share" theory of success or failure. Statistics from the list of products at home and abroad every year can be seen, mostly foreign sales as a statistical object, while domestic sales are always the first one came in, this representation of the aura, to a certain extent, fueled the sales of domestic enterprises to the market over the pursuit, and the "profit for market phenomenon" is not surprising.

According to cost of sales profitability and profit margin analysis, the person concerned that the foreign enterprises and joint stock cooperative enterprises and joint stock enterprise competitiveness in the market relatively strong, the market and corporate earnings to protect bargaining ability. Changes in the external environment, enterprises have a stronger ability to resist risks, it also has the ability to better protect the interests of investors.

From the enterprise to consider the size of large scale enterprises in the profitability of the operation stability has great advantages. From the short term credit considerations, large enterprises and small businesses have a better short term solvency. From the long term credit facilities to consider the long term solvency of the strongest large scale enterprises, small enterprises, though with a certain degree of solvency, but its asset liability ratio is too high, the market less competitive, so long term credit risk remains high.

From every angle, this time the macro control of the construction machinery industry, the impact is profound, for in a fast growing engineering machinery enterprises will undoubtedly be a sudden blow. Not just short term performance decline, but also the development plans for companies that experience a greater degree of damage. On the one hand, investment in fixed assets, especially land resource constraints, banks have tightened credit, allows customers to pay a reduced ability to affect product sales; On the other hand, engineering, enterprise funds tight construction machinery manufacturing enterprises may lead to difficulties in accounts receivable, bad debts increased proportionately.

From the enterprise long term development, in addition to being expanded beyond the project ran aground, corporate sources of funds difficult to be guaranteed the original plan, financing difficulties have emerged. But the macro control has the time and the transitional nature of urban construction and transportation facilities in the next 10 years or less than 20 years, is still the focus of China's economic development, macro regulation and control are mainly based on the bottleneck of energy supply adopted by the short term mitigation measures, and is not a cessation of investment in fixed assets. Therefore, construction machinery industry in the next 10 years, the overall upward trend will not change.

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