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On January 26, 2007, the Lapis Festival of the Lunar New Year. On this day, Zhang Hu, a peasant in Linxi County, Chifeng City, Inner Mongolia, “discarded the old and welcomed the newâ€, and his three-wheeled agricultural vehicle accompanied by more than five years was replaced by a brand-new light truck. Zhang Hu's example is the epitome of the current replacement of the rural market transportation tools.
“The roads in rural areas are getting better and better, and more and more jobs are being carried out. How can we get a car with a little more speed and a little more speed?†Zhang Hu rubbed a shiny new car with rough hands. A look of laughter. In the following interview, the reporter learned that at present, in the rural areas of China, the agricultural planting structure and traffic conditions have been greatly improved, the income channels of farmers have been transformed, traditional agricultural vehicles have been unable to meet the transportation needs, and the replacement of transport vehicles has become a rural area. The general phenomenon.
Demand makes profit. This new phenomenon may lead the Chinese agricultural machinery industry into a new turning point.
Rural reform triggered product upgrades
The clock reversed to early 2005.
Zhang Hu’s village had a new road, wide and straight, and saw a light truck whizzing past him. Zhang Hu’s heart was not a taste. At that moment, Zhang Hu started planning for a new car.
In the past five years, three-wheeled agricultural vehicles were the source of livelihood for Zhang Hu’s family. In the summer, Zhang Hu transported his homegrown vegetables to the vegetable market in the city. In winter, Zhang Hu went to the nearby coal mines to sell some coal and sell them.
Zhang Hu told the reporter: “In the past, the agricultural vehicles in the village were mainly used to buy chemical fertilizers. When the harvest was completed, the grain was shipped out and the farthest distance went to the county. Now that the roads have been cleared, the village’s land is also mostly planted. In greenhouses, these vegetables have to be transported to the cities hundreds of kilometers away for sale, and the three rounds can't keep up.†According to Zhang Hu, in the village, there are few young people engaged in planting. When I went to work in a foreign country to make money, some young people who stayed in my hometown chose logistics transportation. "Like a blink of an eye, the village is running light trucks everywhere."
Gao Yuanen, chairman of the China Association of Agricultural Machinery Industry, said in an interview with this reporter that in recent years, in China's rural areas, not only transport vehicles have changed but agricultural machinery used for agricultural planting has also shifted to large and medium-sized ones. “Agricultural tricycles have upgraded to light trucks, and traditional four-wheel tractors have upgraded to large and medium-sized combine harvesters.†Gao Yuanen thinks this is an inevitable trend in the development of the industry.
At the beginning of the first half of 2006, a series of policies promulgated by the government ignited the demand of farmers for large and medium-sized tractors and harvesters. The increase in production and sales reached 50%-60%. Statistics from the China Agricultural Machinery Industry Association show that in 2006, the domestic agricultural machinery industry is expected to achieve a production and sales amount of 130 billion yuan, an increase of about 22%. In 2007, the agricultural machinery industry will achieve production and sales of 150 billion yuan, an increase of about 15%.
Gao Yuan En analyzed that there has been significant growth on the one hand because of the improvement in the level of domestic machinery manufacturing and the rapid development of the rural economy; on the other hand, there has been a qualitative change in the production and lifestyle of rural China. “In the past, farmers’ production mainly relied on manpower and animal power, and a small number of small horsepower four-wheel tractors, mainly for farming. Later, three-wheeled agricultural vehicles with simple operation and moderate capacity went into the lives of farmers. Today, such as low-speed loading Goods vehicles, agricultural machinery such as large-scale combine harvesters can also free rural people from manual labor."
“They are small and large, they are small and large, they have more power, and they have fewer supporting facilities; they are low-grade, high-grade, and low-grade.†In the past, the product structure of the agricultural machinery industry was gradually being changed. Gao Yuanen said that China’s agricultural machinery has entered an era of upgrading.
Industry shuffle speed
The huge rural market, the temptation is huge. At present, in the light truck market, there are traditional commercial vehicle companies such as Beiqi, Dongfeng, Futian, etc. At the same time, new companies and light truck brands have emerged. Behind this is a large influx of foreign capital.
An industry source who has long been engaged in the production of agricultural machinery revealed to reporters: “At present, the technical content of traditional products in the domestic agricultural machinery industry is low and the market segmentation is not sufficient. There are new enterprises continuously entering this industry, based on their low cost and low difficulty, This includes a large number of foreign capitals."
Gao Yuanen believes that the appearance of this phenomenon not only exacerbates the competition in the agricultural machinery market, but also creates many uncertainties and may also bring about some adverse effects. However, the problem of the market ultimately needs the market to solve. In the face of various problems, Gao Yuanen said that the method of cracking lies in the fact that domestic agricultural machinery companies have spotted market conditions and accelerated their own changes.
“As companies continue to expand their scale, increase their investment in technology research and development, and adjust their industrial structure, competition and competition among various companies will take place in all fields of the agricultural machinery industry. If there is a lack of strategic vision and competitiveness, the scale will not go up again. It is difficult to cope with the impact of the industry and it is also expected that the final elimination will be eliminated, said Gao Yuan-en.
The eve of fate
Compared with commercial vehicles such as Futian, the traditional agricultural machinery enterprises with a single product structure have come to the eve of destiny in the dual constraints of capital and technology.
Among the many agricultural machinery companies that are actively seeking transformation, Shandong Shifeng Group, the industry leader, has recently moved frequently. Twenty years ago, when it started with small tractors, three-wheeled agricultural and single-cylinder engines, the market was dominated by products such as three-wheeled agricultural vehicles, four-wheel tractors and large field work machines. Today, the market situation is drastically changing and the wind is facing a turning point in history.
In a data report provided by Shi Feng, the reporter found that from the sales revenue of the group in recent years, the proportion of sales of low-end products to sales has been declining year by year. In 2006, the total sales of current winds reached 14.16 billion yuan, an increase of 21.9%, while sales revenue from traditional agricultural machinery accounted for only 60% of total sales.
So where does the remaining sales come from? “The new products after upgrading include four-wheel low-speed trucks, light-duty trucks, engineering tires, and large-horsepower tractors. The proportion of these products in sales is increasing,†explains Liu Chengqiang, general manager of Shifeng Group.
In the homogenous competitive environment, agricultural machinery products fight for prices. Today, prices are not the main factor determining the outcome. Whoever has the ability to carry out technological innovation, who can accurately segment the market, who can grab the opportunity? . It is a complicated subject that traditional agricultural machinery companies want to take the lead in the perilous market.
"Implementing an internationalization strategy and participating in international competition." Liu Chengqiang told reporters, "China's agricultural machinery industry is relatively overcapacity. Overseas markets can absorb this part of production capacity. Low-speed vehicles have strong adaptability and low prices, and are particularly suitable for Southeast Asia. Rural areas in developing countries such as Africa and South America."
Sen Lianhua, the deputy general manager of Shi Feng’s responsible technology, told the reporter that when the wind was used as a breakthrough in the tire industry to enter the international market, in 2006, wind only earned more than 40 million U.S. dollars in tire export earnings. In November 2006, when the wind successfully produced a 40.00-57 giant tire with a diameter of 3.7 meters and a weight of 3.6 tons, Shifeng was the only company in the country capable of producing such tires. In 2007, Shifeng plans to reinvest 150 million yuan for the technical transformation of the tire company and form an annual production capacity of 200,000 sets of giant engineering tires. "One such tire has the same value as a limousine." According to Sen Lianhua, this kind of giant mining tire is widely favored by foreign users. Orders in the hands have been scheduled for July this year.
The tire project is just one of the areas where the wind is focused on assault. It is reported that major industrial projects such as the 100,000 kilowatt power generation unit of the thermoelectric center, 6.6 million sets of agricultural equipment tires, 30,000 tons of nylon industrial fabrics, 5,000 combine harvesters, and farm fittings have all been ready for use. The leading products are gradually developed into low-speed trucks, light trucks, tractors, engines, tires and combine harvesters on the basis of three-wheeled vehicles. This development model was summarized by Liu Chengqiang as "concentric diversification."
The search for breakthrough time may give China's agricultural machinery companies a little inspiration.