Consolidation forecast for Chinese manufacturers

By Helen Wright25 November 2013

Zeng Guang'an, president of Liugong Machinery, speaking during ICEF

Zeng Guang'an, president of Liugong Machinery, speaking during ICEF

Consolidation will increase among Chinese construction equipment manufacturers in the coming years, according to Zeng Guang'an, president of Liugong Machinery.

Speaking on 22 November, during the second day of the International Construction Economic Forum (ICEF), Mr Zeng said China's construction equipment market was entering a decade of more mature and slower growth compared to the last 10 years.

"I think the current figure of 300 manufacturers in China will reduce to 100 in the coming years," Mr Zeng said.

Mr Zeng also highlighted the current situation of overcapacity in the Chinese market. He said manufacturers would be seeking out new opportunities for exports in the years ahead, in both mature and emerging markets.

"A lot of new reform and changes in politics, the economy and society is coming," he added. "GDP growth of between +7% and +8% is forecast for the next decade, and the whole country will focus on high quality and improving efficiency in construction equipment.

"Production of Chinese construction equipment will slow down to more reasonable growth. We have to go from high-speed growth to low-speed growth and the industry's values are also changing.

"There is a stereotype of low cost and low quality in Chinese-built products, and while this idea existed 10 years ago and was right, today it has totally changed. There are many misconceptions about Chinese manufacturing.”

The inaugural International Construction Economic Forum (ICEF) took place from 20 to 22 November at the Hotel Okura in Amsterdam, the Netherlands.

ICEF 2014 will be held from October 29 to 31 at the Gloucester Hotel in London, UK. More details will be available shortly at www.icef.biz

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