Analysis On Problems In China Machinery, Pump And Valve Industries

The lack in variety and specifications of basic parts in China's machinery caused

the big gap with high-end products, therefore can't meet the growing needs of the machinery. At present, the performance of base parts is just equivalent to the international level of 1980s. The unstable quality, high failure rate in early period and poor reliability are fatal weakness of foundation pieces. Therefore, many OEMs often choose imported base-sets in order to improve the market competition of its machinery, which results in less domestic market share of domestic-based pieces extraordinarily the low-tech products. Although the export advantage of China's basic items is obvious, they are mainly labor-intensive products in large quantities, low-value and not high technical value-added.

First, serious overlapping, low degree of specialization, unformed scale and low economic efficiency

Compared with machinery, the spare components new enterprises require relatively less initial financial and technical inputs. Therefore, in several national economic development period a number of basic parts manufacturers have set up but get along with the big quantity and small productivity, which couldnt form economies of scale. Even if basic pieces enterprises are gradually independent from the machinery line, but most of the companies no matter large or small are in wide range, which complete with lack of specialization, low level of equipment, unstable quality and low economic profits. The per capita output in industrialized countries is about USD 150 000-200 000, while there is only RMB 40 000 to 50 000 in China. In recent years, with the common development policy carrying out for multiple ownership, the basic components industry is experiencing the intensive development process from decentralization to concentration gradually. Such as Shuiben Pumps, Dongda Power, Fadong Power, Domanda Pumps

Second, weak research and development, insufficient capital investment and slow technological progress

In late 1970s and early 1980s, basic spare industry has introduced a number of foreign advanced technologies, but they lacked of adequate hardware and software investment in absorption. According to foreign experience, the required capital ratio of technology introduction and absorption and implementation is about 1:7, but China learns it very late, which result in the slow of development. Actually the market competition is just a challenge for technical strength. Foreign countries have attached great importance for it, they achieve technical heights through input large investment. The funds of research and development of many well-known companies are 4 to 5 of their turnover, even reach 10 for focus areas. At present in China many university institutes are engaged in science research, and a lot of theoretical research, scientific research and patents papers show a very high level, but the combination with the actual production is not tight that caused the low speed of transforming into commodities.

Above provided by SelectChina.com, and find more information on China Machinery News/ China Machinery Manufacturers / China Machinery Products.

by: Deland Selectchina

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