Why the Construction Machinery Industry Becomes a Favorite in the Eyes of Foreign Investment

As construction machinery is a labor-intensive industry, China’s construction machinery industry has emerged from the situation in the areas of loaders, bulldozers, concrete machinery, and other fields that prohibit multinational companies from exiting the country due to labor cost advantages, as well as excavators, forklifts, and roads. Machinery and other products have also begun to squeeze the substitution of imported products from the low-end market. This has led some multinational corporations to change their industry strategy in China. The transformation from the original product input to the capital input is mainly aimed at the adoption of acquisitions. The merger recaptured lost market share in China. The Caterpillar acquisition boom and the acquisition of Xugong by Carlyle since the beginning of this year are the prelude to this industry’s capital output.

"Regularly control the scale of investment in fixed assets, adhere to different treatment, maintain pressure, and adjust investment structure." During the period of "Eleventh Five-Year Plan", China's rapid economic growth, fixed-asset investment will still occupy a large proportion, which implies Huge demand for construction machinery, foreign investment is exactly the big cake of China's construction machinery industry.

However, during the two sessions in March of this year, the protection of our national enterprises and the protection of national brands were elevated to a new height. The former Director of the National Bureau of Statistics, Li Deshui, reminded that “to be cautious about monopolistic cross-border mergers and acquisitions” aroused strong opinions from all parties. attention. Foreign investment also encountered resistance to the mergers and acquisitions of the construction machinery industry in China. Carlyle’s acquisition of Xugong’s case has not yet received approval from the Ministry of Commerce. It is understood that the Chinese government is formulating a document aimed at regulating foreign investment in China's equipment manufacturing industry in the M & A entry threshold, is currently soliciting opinions and amendments, is expected to be announced in the near future.

The president of Sany Heavy Industry, Xiang Wenbo, recently stated that he intends to acquire XCMG at a price 30% higher than that of Carlyle, that is, US$300 million, on the basis of overall acceptance of the Carlyle program. The re-entry of Sany Heavy Industry undoubtedly added new variables to this eye-catching merger.

Regardless of the final outcome of the acquisition of XCMG by Carlyle, the tone of “Carefully treating monopolistic cross-border mergers and acquisitions” has been established, and the way will be followed by the introduction of strategic investors under the premise of the forthcoming introduction of foreign M&As. The purpose of introducing advanced international management and technology and upgrading the overall level of China's construction machinery industry will, of course, include the introduction of strategic investors such as Sany Heavy Industries.

Meticulous division of labour, consecutive processes, professional of manufacture and high standard equipment ensure the high quality of the machine. 

Factory introduced high precision maching tools, with the equipment of cutting machine tools, heattreating facilities, check out test sets and painting facilities, the processing ability for middle and large size machine, reach a high level in plastic industry while the quality if the machine is ensured at the same time. 

Middle size machine can produce differnt design of crates and containers, videos can be provided. 

Vertification of many year's market application, optimal combination configuration, stable, reliable and durable system with the characteristics of high efficiency, energy saving, low voice and strong power. 

The strengthening design of template is carried out through multiple times of optimization design of major components such as template, based on the analysis of finite element software, which both guarantee the lifetime of template and protected mould. 

High rigid template adopts the structure with coexistence of installation screw hole and T-shaped groove. 

The tie rod of each machine model has passed the test by professional testing organization, which means that, the deflection of tie rod is within reasonable scope while guaranteeing the operation of machine. 

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