On February 27th, the Japan Construction Machinery Industry Association released data. The data shows that in 2018, Japan’s shipments are expected to reach 2.3998 trillion yen (approximately RMB 142.4 billion), a 5% increase from the 2017 forecast. The previously forecasted supply will be reduced, but due to strong sales in the North American and Chinese markets, this time it will increase. In addition, the orders and production volume of machine tools and robots are also expected to increase. The pattern of China's growth driven by the Japanese equipment sector seems to continue.
The Japan Construction Machinery Industry Association stated that Japan’s exhaust emission regulations have become more and more stringent, so in 2017, Japan’s buying needs have emerged. Due to its adverse effects, shipments to Japan within 2018 are expected to decrease by 4%. However, as exports to North America and Asia, which promote housing construction and infrastructure investment, will increase by 11%, overall growth will remain positive.
It is reported that the volume of shipments in 2018 is expected to further increase, exceeding the original highest 2017 of 2.2831 trillion yen (about 135.5 billion yuan).
According to the report, in the large construction machinery market in China, with the investment in public utilities and infrastructure, demand is expected to continue to increase.
According to the Japan Construction Machinery Industry Association, in 2018, member companies with increased demand in China are expected to account for 85% of the total, and 71% in 2019. The rest of the companies expect that the demand in China will remain the same as before, and it is expected that the company with reduced demand will be zero.
Hirano Gentaro, president of the Japan Construction Machinery Industry Association (HIT), said that "although there is still lack of transparency, it is expected to remain strong." Hitachi Construction Machinery stated that “it was originally thought that there will be a risk of deceleration in demand after 2017, but it will soon be expected to see a larger amount of workâ€.
Japan's domestic manufacturing industry is affected by favorable factors in the Chinese market
On the one hand, China's demand has driven Japan's machine tool and robot orders to reach the highest level in history. On the other hand, increased demand also poses problems for Japanese manufacturers.
Japan Machine Tool Industry Association said that in 2017 the amount of machine tool orders increased by 31.6% year-on-year, reaching 1.6455 trillion yen (about 97.79 billion yuan), a time after 10 hit a record high again. It is expected that the volume of orders for the whole year of 2018 will reach 1.7 trillion yen (approximately RMB 100.98 billion), which will hit a record high for two consecutive years.
According to a survey conducted by the Japan Robotics Industry Association, the amount of robot orders (calculated by members) in 2017 increased 34.1% year-on-year to reach 759.4 billion yen (approximately RMB 45.1 billion), a record high. The total production of the association's member companies and non-member companies seems to have reached 900 billion yen (approximately RMB 53.4 billion). It is expected that the production volume in 2018 will further increase to reach the 1 trillion yen (approximately RMB 59.4 billion).
The report said that in the future, Japan's manufacturing frontline may have the problem of insufficient supply of spare parts as demand increases. In the field of machine tools, etc., the extension of delivery time will be a problem. In terms of construction machinery, Harry Kobrak, executive director of Caterpillar Japan, said, "If demand increases further in the future, the supply of components will reach the limit."
Prior to this, Japan had experienced a sharp decline in demand for construction machinery due to shrinking public investment. Therefore, manufacturers would not easily expand their investment, and will continue to explore changes in demand in the future.
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