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Chinese Machinery Production will Continue to Grow Steadily and Relatively Fast from 2012 to 2016
Date: 18 April 2012

Jay Tang, Analyst

Shanghai, 16 April 2012 - According to a recent IMS Research (recently acquired by IHS Inc. (NYSE:IHS))s study, The China Machinery Production Yearbook - 2012 Edition, after growing rapidly  28.2 percent in 2010, the annual growth rate of production of industrial machinery in China will fall to 17.6 percent in 2011, to reach more than $335 billion. Revenues are forecast to reach more than $627 billion in 2016, with an average annual growth rate of more than 13 percent from 2012 to 2016.

“Because of economic turmoil in Europe and weakening demand and tighter monetary policies at home, the growth of Chinese machine production is slowing down and entering a period of steady growth”, commented IMS Research Analyst Jay Tang.

According to the International Monetary Fund (IMF), China GDP grew by 9.2 percent in 2011, and predictions for 2012 indicate slightly slower growth of 8.2 percent. With persistent inflationary pressure, the Chinese government will not introduce massive stimulus policies in 2012. Price increases have reduced personal disposable incomes, stifling growth in domestic consumption. IMS Research forecasts that Chinese machinery production in 2012 will grow 13.3 percent in 2012 to more than $380 billion.

Tang continued, “Of the machinery sectors analyzed, production of materials-handling machinery had the largest revenues in 2011, $70 billion or 20 percent of the total. The next largest sectors in China were production of agricultural machinery, machine tools, wind turbines, and textile machinery. ”

The total value of automation product production in 2010 was estimated as $16.5 billion. Across all machinery sectors, the machine-tool sector was the largest for automation products, worth over $3.4 billion in 2010. Material handling was the next largest, followed by wind turbines and textile machinery.

Automation & motion control products, motors & drives, and mechanics for electric drive systems are the clearly the leading three product types; they accounted for 22.8 percent, 19.1 percent and 18.1 percent of total automation product revenues respectively.

With China’s continuing industrialization and urbanization, there is no doubt that China’s machinery production is in a phase of steady growth. In the meantime, as China speeds up transforming and updating its manufacturing industries, the automation industry as the key element, will have very good prospects.

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