Bearing Industry Growth Will Decline
Bearing industry as capital goods production sector influenced by economic cycles, through the study of Japan and China’s bearing industry history, we believe that capital goods production sector, as its cyclical correlation with the macroeconomic cycle is very high, international expansion can effectively resist the country’s economic recession risks, but still difficult to avoid the global economic crisis. China’s bearing industry since 2006, entered a weaker external demand, a new era of stronger domestic demand, domestic factors dominated industry. Fixed asset investment and credit growth and bearing a positive correlation between industry growth rate, we generally judge in the current macro-control policy, the bearing industry in 2008 growth will be down.
China is not the bearing axis Cheng Daguo power, China is the world’s fourth largest bearing producer behind the U.S., EU and Japan, accounting for 10% of the total global market; 2007, China’s bearing industry, total sales revenue of approximately 80.5 billion, up 25.7%, total production of 11.022 billion sets of various types of rolling bearings, up 37.86 percent. The vast majority of our production is small and small bearings, bearing more than in large-scale production of less than 3%, but the method of calculation of output accounted for 35% of large bearings.
Division of the product structure, ball bearings largest, accounting for 79.8% of total production.
Industry brought over scattered low competition, low profit margins due to backward technology; scale bearing enterprises in China 1205, the top 30 only 32.97 percent of market concentration, the average per 1.099% market share, industry concentration is considerably low. Concentration makes the industry gross profit and ROE is lower than international competitors, in 2007 China’s bearing industry average gross margin of about 14.3%, the average ROE was 2.38%, also led to the raw materials in China bearing the loss of voice, enterprise can not effectively pass the cost of raw materials increased.
Policy guidance highlights the industry consolidation and upgrade; although the angle from the output value of China in 2008 will be 11 five goals ahead of schedule, but technology and energy consumption indicators to be improved. Overall, although the bearing industry, the next few years will be subject to the credit policy and economic cycles fluctuate, but the bearing industry policy highlights the escalation of industrial integration and the tendency of trade protection, policy-oriented role will lead the capital to invest in key areas of the bearing industry, to high-precision, high-tech and high added value integrated upgrade of the road segments will have more surprises.
Credit and investment cycles and policies tend to make sub-industry boom of differentiation, bearing our most promising sub-sectors are bearings of construction machinery, wind power bearings, railway bearings, agricultural bearings, metallurgical and mining bearings, these sub-sectors in the economy degree up period.
Motorcycle bearing, home appliances bearings, machine tool bearings these sub-sectors in the adjustment, driver of the downstream industry is the rising demand for technology upgrades to enhance the industry demand for products bearing mainly high value-added products, primarily from demand import substitution. Automobile bearings, mechanical bearings by the China Petroleum and Chemical macro-control of the economy dropped the next two years.
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