The Situation About the Machinery Industry

Some sub-industries such as container, bearings and valves, electrical and general instrumentation industries should be cautious about the market situations. It is predicted that the above mentioned industries may reach the high point of the economy, but it will be decreased to some extent. However, some sub-industries which have larger scale like the construction machinery decreased at the early time, but they may have a certain degree of recovery in the future because of the smaller base. And the rate of many other industries such as the rail transportation equipments and shipbuilding industry will continue to rise.

In the second half of this year, due to the impact of the slowdown of the investments in fixed assets, the growth of machinery industry will come down significantly. At the same time, the sub-industries will be future divided.

Among all the different industries, the container industry, bearing industry, valve industry, motors, and boiler-making industry keep the high point in the first half of the year, and the cumulative total profit growth rate is maintained at more than 40%. But many industries such as the special instrumentation, electronic measurement, measuring equipment, and engineering machinery appeared a decline in sales revenue. Meanwhile, profits of these industries decreased significantly. However, few machinery industries like the rail transportation equipments and the ship manufacturing industry developed very well when compared to others.

In the machinery industry, many components such as bearings, valves, general parts are the upstream sectors as to the most machinery. The slowdown of the macroeconomic and the investments in the fixed asset will firstly lead to the slowdown of requirements for large machinery and equipments. Then it will further affect the component industry. Generally speaking, the change of the basic parts lags behind the changes in machinery and equipment.

It is expected that those industries which have a quick drop such as the special equipments manufacturing industry, the instrumentation manufacturing industry and transportation equipment manufacturing industry will stabilize in the second half of this year. And because of hysteresis effects, the drop rate of ordinary machinery manufacturing industries (including boilers, metal processing machinery, general equipments, bearings, valves, and other general components) will increase in the second half of this year which will exceed the average level of industry.

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