At the beginning of 2025, the Chinese construction machinery industry is showing a strong recovery momentum. According to data from the China Construction Machinery Industry Association, the cumulative domestic sales of excavators in January and February increased by 51.4% year-on-year, while the domestic sales of loaders increased by 26.2%, far exceeding market expectations.
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Domestic market: parallel recovery trend and structural upgrading
This growth trend is due to the combined effect of multiple factors:
Firstly, the equipment sold in the previous industry upswing cycle (2015-2023) has entered an 8-10 year update cycle, and 2025 has become a key node for the centralized replacement of existing equipment. The monthly growth rate of excavators alone reached 99.4% in February.
Secondly, since the fourth quarter of 2024, the funding side of domestic projects has gradually improved, and the marginal improvement in demand in municipal engineering, infrastructure and other fields has driven the recovery of sales of non excavation equipment such as cranes and concrete machinery. In addition, the high growth rate of water conservancy investment (supporting the demand for small excavations), the stabilization of real estate and the strengthening of infrastructure (promoting the recovery of medium excavations), and the stability of mining demand (benefiting the large excavation market) have formed a resonance in multiple fields, further consolidating the growth foundation of the industry.
At the level of technological innovation, Chinese enterprises are accelerating their transformation towards high-end, intelligent, and green products.
Taking electric loaders as an example, in 2024, the domestic market sales increased by 361% year-on-year, with electric forklifts accounting for 70.8% of sales, and the electric rate of lifting work platforms exceeding 90%. The E-GTN framework, an unmanned mining technology jointly developed by Sany Heavy Industry and Shanghai Jiao Tong University, significantly improves the decision-making ability and environmental adaptability of unmanned operations through terrain feature extraction and multimodal fusion technology. Liugong has successfully entered the Indonesian market through electric loaders equipped with high-performance commercial storage battery systems, providing a demonstration for the transition to green energy.
These technological breakthroughs not only reduce energy consumption costs, but also promote the upgrading of the industry from traditional manufacturing to "intelligent manufacturing+green manufacturing".
02
International market: intensifying differentiation and the global breakthrough of Chinese enterprises
The global construction machinery market is showing a clear differentiation trend in 2024. Due to the high interest rate environment, investment has been suppressed in the North American and European markets, and the equipment replacement cycle is nearing its end, resulting in continued weak demand. International giants such as Caterpillar and Volvo have generally experienced a decline in revenue. For example, Caterpillar's sales in 2024 decreased by 3% year-on-year, while Volvo Construction Equipment's net sales decreased by 16%.
In contrast, emerging markets such as Asia Pacific, Latin America, and the Middle East have become growth highlights. Komatsu's net sales for the first three quarters of fiscal year 2024 increased by 5.8%, thanks to the price advantage brought by the depreciation of the Japanese yen and the demand for mining equipment; Chinese companies such as Zoomlion and Sany Heavy Industry have steadily increased their market share in Southeast Asia, Africa, the Middle East, and other regions. In 2024, China's engineering machinery exports reached 52.88 billion US dollars, a year-on-year increase of 8.8%.
The globalization strategy of Chinese enterprises has shifted from single product exports to deep industrial layout. For example, Zoomlion has invested in building a high-altitude operation equipment production base in Hungary, planning to cultivate a localized industrial chain; Sany Group has established 15 overseas R&D and manufacturing factories in India, Indonesia and other places, with products covering more than 180 countries; China Railway Construction Heavy Industry participated in the formulation of international standards and expanded its business to 49 countries.
These measures not only enhance brand influence, but also effectively address trade barriers and carbon tariff challenges in the European and American markets through technological adaptation (such as low-temperature version cranes adapted to extremely cold environments) and service localization (such as establishing assembly factories in Germany and the United States).
03
Future Trends: Technological Revolution and Industrial Pattern Restructuring
Electrification and intelligence accelerate penetration
Driven by global environmental policies, the electrification rate of construction machinery has rapidly increased. In 2024, the proportion of domestic electric loader sales has reached 11.6%, and it is expected to further expand to emerging markets by 2025. In terms of intelligence, technologies such as unmanned operation and remote control will become mainstream, and the integration of large models and reinforcement learning will significantly improve the environmental adaptability and operational efficiency of devices.
Deepening globalization layout and integration of industrial chains
Chinese companies need to establish a more comprehensive supply chain network overseas, reduce costs through localized production, and participate in international standard setting to enhance their voice. For example, Zoomlion plans to establish a skills training center with local universities at its factory in Hungary, while Sany's lighthouse factory in BRICS countries has driven local technological progress.
Release of emerging market demand and regional coordinated development
India, Vietnam, Indonesia and other countries continue to increase their infrastructure investment. For example, India's infrastructure investment is expected to reach $1 trillion in the next five years, while Vietnam plans to invest $160 billion to build highways, railways and other infrastructure projects. With its cost-effectiveness advantage, Chinese construction machinery is expected to occupy a larger market share in these markets, forming a collaborative model of "Chinese technology+local manufacturing".
Challenge and Response
The challenges faced by the industry include intensified trade barriers between Europe and the United States, price competition, and immature high-energy density battery technology. Enterprises need to increase research and development investment, break through core technology bottlenecks, and improve profit margins through differentiated competition (such as high-end product layout). The government can take the lead in establishing an international certification alliance to accelerate standard conversion and assist enterprises in "going global".
The Chinese mechanical engineering industry is standing at a critical juncture of global industrial restructuring. The recovery of the domestic market provides application scenarios for technological innovation, while the expansion of overseas markets injects new momentum into industrial upgrading. In the future, electrification, intelligence, and globalization will become the main lines of industry development. Enterprises need to continue to make efforts in technological breakthroughs, localized operations, and ecological construction in order to occupy a dominant position in fierce international competition.
With the deepening of the "the Belt and Road" initiative and the release of demand from emerging markets, China's mechanical engineering is expected to move from a "manufacturing power" to a "technological power", contributing more "China's programs" to global infrastructure construction and sustainable development.
Qingdao Kotai Heavy Industry Machinery Co., Ltd.
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