Machine Tools in China

• Publication date: August 2011

Demand in China to grow 14.2% yearly through 2014 Demand for machine tools in China is projected to grow 14.2 percent annually to ¥389 billion in 2014. This strong growth will bolster China’s current position as the world’s leading consumer and producer of machine tools. Both supply and demand will benefit from a number of government policies set forth in the Twelfth Five-Year Plan. Economic goals in the Plan that are especial...

Demand in China to grow 14.2% yearly through 2014

Demand for machine tools in China is projected to grow 14.2 percent annually to ¥389 billion in 2014. This strong growth will bolster China’s current position as the world’s leading consumer and producer of machine tools. Both supply and demand will benefit from a number of government policies set forth in the Twelfth Five-Year Plan. Economic goals in the Plan that are especially salient to the machine tool industry are the development of Strategic Emerging Industries (SEIs), which will receive beneficial government treatment and the push for “Indigenous Innovation.”

Advanced machine tools to be subsidized

High-end equipment manufacturing is designated as one of the SEIs and will be extensively promoted by the Chinese government. Advanced machine tool manufacturing is an important segment of high-end equipment manufacturing, and as such, the industry will benefit from subsidies offered by both the central and local governments for research and development. Sales of high-end machine tools will also benefit from favorable tariff policies that will promote the sales of domestic products. China plans to be an innovation-oriented society by 2020 and a variety of megaprojects have been introduced to achieve the goal, including the development of computerized numerical controlled (CNC) machine tools that will focus on serving key industries, such as aviation equipment, ship building, motor vehicles and generating equipment. Research and innovation in the advanced machine tool industry will be supported by government initiatives so that domestic producers can become more competitive in terms of technology, thus increasing their share of the domestic market. The major markets for machine tools in China are industrial machinery and equipment, transportation equipment, primary and fabricated metals, and electrical and electronic equipment. Industrial machinery is the largest market for machine tools due to the extensive use of various machine tools in numerous segments of the industry. Transportation equipment manufacturing, the second largest market, has been supported by the explosive development of the automobile industry in China over the past decade.

Machine tool accessories to be fastest growing segment

Metal cutting machine tools form the largest product segment, which is about three times larger than the metal forming segment. Demand for machine tool accessories is projected to increase at an annual rate of 16.1 percent to 2014, faster than both metal cutting and metal forming machine tools.

Machine Tool And Equipment Industry in China

TABLE OF CONTENTS

INTRODUCTION ix

I. EXECUTIVE SUMMARY 1

II. MARKET ENVIRONMENT 4

General 4
Economic Overview 5
Recent Economic Performance 5
Economic Outlook 8
Demographic Overview 11
Currency Exchange Rates 14
Manufacturing Overview 17
Gross Fixed Capital Formation Outlook 19
Pricing Patterns 20
Technology 22
Legal & Regulatory Environment 25
The Twelfth Five-Year Plan 28
Five-Year Plan Overview 28
Twelfth Five-Year Plan’s Provisions 29
International Environment 31
Foreign Trade 34

III. PRODUCTS 37

Supply & Demand 37
Metal Cutting Machine Tools 41
Lathes, Milling & Related Machines 44
Lathes 46
Milling Machines 48
Drilling Machines 51
Boring Machines 53
Machining Centers & Related Machines 55
Vertical 58
Horizontal 59
Plano 59
Other 60
Grinding & Related Machines 60
Grinding Machines 62
Sharpening Machines 64
Polishing Machines 65
EDM, Laser & Related Machines 67
EDM 70
Laser Machines 71
Other Special Processing Machines 72
Gear Cutting, Shaping & Other Metal Cutting Machines 73
Gear Cutting Machines 74
Shaping & Related Machines 76
Other Metal Cutting Machines 77
Metal Forming Machine Tools 78
Presses & Other Forging Machines 81
Mechanical Presses 82
Hydraulic Presses 83
Other Forging Machines 84
Bending, Shearing & Punching Machines 84
Bending Machines 86
Shearing & Punching Machines 88
Other Metal Forming Machines 90
Wire Forming Machines 92
All Other Metal Forming Machines 92
Machine Tool Accessories 93
Measuring Tools 95
Cutting Tools 96
Tool Holders & Headings 96

IV. MARKETS 98

General 98
Industrial Machinery 101
Industrial Machinery Capital Formation Outlook 102
Machine Tool Market 104
Transportation Equipment 106
Transportation Equipment Fixed Capital Formation
Outlook 107
Machine Tool Market 110
Primary & Fabricated Metal 113
Metal Fixed Capital Formation Outlook 114
Machine Tool Market 115
Electrical & Electronic 117
Electrical & Electronic Equipment Fixed Capital Formation
Outlook 117
Machine Tool Market 119
Other Markets 121

V. REGIONAL TRENDS 123

General 123
Regional Demographic & Economic Trends 125
Population Patterns 126
Economic Outlook 127
Regional Manufacturing Value Added Outlook 128
Regional Fixed Capital Formation Outlook 130
Regional Machine Tool Demand 132
Central-North 134
Overview 134
Machine Tool Demand 136
Northeast 138
Overview 138
Machine Tool Demand 140
Central-East 142
Overview 142
Machine Tool Demand 144
Central-South 146
Overview 146
Machine Tool Demand 148
Southwest 150
Overview 150
Machine Tool Demand 152
Northwest 154
Overview 154
Machine Tool Demand 156

VI. INDUSTRY STRUCTURE 159

General 159
Industry Composition 160
Market Share 162
Product Development & Manufacturing 166
Marketing & Distribution 167
Financial Issues & Requirements 169
Mergers & Acquisitions 170
Foreign Participation in the Chinese Market 172
Legal & Regulatory Issues 173
Joint Ventures 175
Wholly Owned Foreign Enterprises 179
Representative Offices 180
Company Profiles 180
Amada Company Limited 181
Baoji Machine Tool Group, see Qinchuan Machine Tool
Group
Beijing No. 1 Machine Tool Plant 184
BYJC-Okuma Beijing Machine Tool, see Beijing No. 1
Machine Tool Plant and Okuma
China General Technology Group Holding Company
Limited 187
Chongqing Machinery & Electric Company Limited 189
Dalian Machine Tool Group Corporation 191
Gildemeister AG 194
Guangzhou Machine Tool Works Company Limited 196
Guilin Machine Tool Company Limited 197
Hangzhou Machine Tool Group Company Limited 198
Hanland Machine Tool Group Company Limited 201
Harbin Measuring and Cutting Tool Group, see China
General Technology Group Holding
INDEX-Werke GmbH & Company KG Hahn & Tessky 203
Jack Holding Group Company Limited 205
Jiangsu Shinri Machine Tool Group Company Limited 206
Jiangsu Xuzhou Metalforming Machine Group Company
Limited 207
Jiangsu Yangli Group 208
Jiangsu Yawei Machine Tool Company Limited 209
Jier Machine-Tool Group Company Limited 211
MAG IAS Holdings Incorporated 212
Mori Seiki Company Limited 214
Ningxia Little Giant Machine Tool, see Yamazaki Mazak
Okuma Corporation 217
Qier Machine Tool Group, see China General Technology
Group Holding
Qinchuan Machine Tool Group Company Limited 219
Qinghai Huading Industrial Company Limited 221
Qiqihar Heavy CNC Equipment, see Zhejiang Tianma
Bearing
Shandong Lunan Machine Tool Company Limited 223
Shanghai Electric Group Company Limited 224
Shenyang Machine Tool Group Company Limited 225
Sichuan Changzheng Machine Tool Company Limited 229
Suzhou Sanguang Science & Technology Company Limited 230
Tiangong International Company Limited 231
Tianjin No. 1 Machine Tool Works 232
Tianshui Spark Machine Tool Company Limited 233
TONTEC Technology Investment Group Company Limited 235
TRUMPF Group 236
Weihai Huadong Automation Company Limited 238
Wuhan Heavy Duty Machine Tool Group Company Limited 239
Yamazaki Mazak Corporation 241
Zhejiang Kaida Machine Tool Group Limited 243
Zhejiang Tianma Bearing Company Limited 244
Other Companies Mentioned in the Study 246

LIST OF TABLES

SECTION I -- EXECUTIVE SUMMARY

Summary Table 3

SECTION II -- MARKET ENVIRONMENT

1 Gross Domestic Product of China 11
2 Population of China 13
3 Chinese Currency Exchange Rates, 1999-2009 16
4 Manufacturing Value Added 18
5 Gross Fixed Capital Formation in China 20
6 Selected Machine Tool Pricing Patterns in China 22
7 Chinese Foreign Trade in Machine Tools 36

SECTION III -- PRODUCTS

1 Machine Tool Supply & Demand in China 40
2 Metal Cutting Machine Tool Supply & Demand in China 44
3 Lathe, Milling & Related Machine Supply & Demand in China 46
4 Lathe Supply & Demand in China 48
5 Milling Machine Supply & Demand in China 51
6 Drilling Machine Supply & Demand in China 53
7 Boring Machine Supply & Demand in China 55
8 Machining Center & Related Machine Supply & Demand
in China 58
9 Grinding & Related Machine Supply & Demand in China 62
10 Grinding Machine Supply & Demand in China 64
11 Sharpening Machine Supply & Demand in China 65
12 Polishing Machine Supply & Demand in China 67
13 EDM, Laser & Related Machine Supply & Demand in China 70
14 Gear Cutting, Shaping & Other Machine Supply & Demand
in China 74
15 Gear Cutting Machine Supply & Demand in China 75
16 Shaping & Related Machine Supply & Demand in China 77
17 Other Metal Cutting Machine Supply & Demand in China 78
18 Metal Forming Machine Tool Supply & Demand in China 80
19 Presses & Other Forging Machine Supply & Demand in China 82
20 Bending, Shearing & Punching Machine Supply & Demand
in China 86
21 Bending Machine Supply & Demand in China 88
22 Shearing & Punching Machine Supply & Demand in China 90
23 Other Metal Forming Machine Supply & Demand in China 92
24 Machine Tool Accessory Supply & Demand in China 95

SECTION IV -- MARKETS

1 Machine Tool Demand in China by Market 100
2 Industrial Machinery Fixed Capital Formation in China 104
3 Industrial Machinery Machine Tool Demand in China 106
4 Transportation Equipment Fixed Capital Formation in China 110
5 Transportation Equipment Machine Tool Demand in China 113
6 Primary & Fabricated Metals Fixed Capital Formation in China 115
7 Primary & Fabricated Metals Machine Tool Demand in China 116
8 Electrical & Electronic Product Fixed Capital Formation
in China 119
9 Electrical & Electronic Product Machine Tool Demand
in China 120
10 Other Markets Machine Tool Demand in China 122

SECTION V -- REGIONAL TRENDS

1 Population of China by Region 127
2 Gross Domestic Product of China by Region 128
3 Manufacturing Value Added in China by Region 130
4 Gross Fixed Capital Formation in China by Region 132
5 Machine Tool Demand in China by Region 134
6 Central-North Region of China: Machine Tool Demand 138
7 Northeast Region of China: Machine Tool Demand 142
8 Central-East Region of China: Machine Tool Demand 146
9 Central-South Region of China: Machine Tool Demand 150
10 Southwest Region of China: Machine Tool Demand 154
11 Northwest Region of China: Machine Tool Demand 158

SECTION VI -- INDUSTRY STRUCTURE

1 Revenue Data: Selected Machine Tool Companies, 2009 161
2 Selected Acquisitions & Divestitures 172
3 Selected Joint Ventures 177

LIST OF CHARTS

SECTION II -- MARKET ENVIRONMENT

1 Population of China by Age, 1999-2019 14
2 Chinese Currency Exchange Rates, 1999-2009 17

SECTION III -- PRODUCTS
1 Machine Tool Demand in China by Product, 2009 41

SECTION IV -- MARKETS
1 Machine Tool Demand in China by Market, 2009 101

SECTION V -- REGIONAL TRENDS
1 Machine Tool Demand in China by Region, 2009 133
2 Central-North Region of China 136
3 Northeast Region of China 140
4 Central-East Region of China 144
5 Central-South Region of China 148
6 Southwest Region of China 152
7 Northwest Region of China 156

SECTION VI -- INDUSTRY STRUCTURE
1 Machine Tool Market Share in China by Company, 2009 162