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China's Machine Tool Industry Achieves Better-than-expected First Half Results
The status quo of China's machine tool industry in the first half this year exceeded people's expectation.
According to the latest statistics, from January to June this year, the industry's industrial output value totaled RMB75.622 billion, up 25.8% from a year earlier, which was 5.8 percentage points less than the same period last year.
Sales revenue increased 26.3% year-on-year to RMB72.237 billion, down 2.9 percentage points from a year earlier.
A total of 95.8% of industrial products were sold, dropped 0.8 percentage point year-on-year.
Profit went up to RMB3.81665 billion, a year-on-year increase of 37.2%, which was 8.2 percentage points higher than the same period last year. The increase in profit in state-owned, private and foreign-invested enterprises was 22.3%, 58.6% and 41.9% respectively.
Industrial output value rise faster than output volume
In terms of output, China produced 264,046 units of metal cutting machines, up 10.8% year-on-year, plus 80,763 units of metal forming machines, a decrease of 20.5%.
Among them, output of CNC metal cutting machine tools amounted to 37,892 units, representing a 20.5% increase, while that of metal forming machines was 1,157 units, down 32.7%.
The industrial output value of metal cutting machine tool industry and metal forming industry went up 17.2% and 42% respectively, surpassing their corresponding output volumes.
Imports grow much slower
China's machine tool imports posted a significantly slower growth rate of 8.46% in the first half this year. Amounting to US$5.198 billion, it was 13.77 percentage points lower than the growth rate a year earlier.
China's machine tool imports in the first half of 2006
China's exports of machine tools in the first half of 2006
By product category, imports of metal working machines (including metal cutting and forming machines) reached US$3.361 billion, up 4.04% year-on-year, but down 18.75 percentage points from the growth rate last year. Imports of cutting tools and presses, on the contrary, continued to grow rapidly, by 41.38% and 33.93% respectively.
We believe the slowdown in imports value may be due to several reasons. One is the fluctuation in foreign direct investment, which accounts for 60% of China's machine tool imports. Meanwhile, the quality improvement in domestic CNC machine tools and the shift of overseas factories to China also lead to reduced imports.
Exports remain stable
During the same period, China exported machine tools of US$1.718 billion, up 50.23%. CNC products accounted for 32.55% of the total exports, which was 4.7 percentage points higher than the percentage last year.
Slowdown to be seen in second half year
Looking forward to the second half, it is expected that the machine tool industry will grow at an even slower rate, and continue to post a stable and relatively fast growth for the full year.
Imports for the full year will grow slower than output value, with domestic machine tools taking up a market share of 40% or above.
Exports for the full year will be slightly higher than last year's US$6.5 billion, making China the world's largest machine tool importer for the past five years in a row.
| Product Model | Inside Diameter | Outside Diameter | Thickness |
| H240/1400HG bearing | 1400 | ||
| H30/1400HG bearing | 1400 |