The competition is not cooperative and the crane strategic alliance is ready

Competition does not mean no cooperation

On September 18th, a small conference aimed at setting up a "China Engineering Machinery Industry Industry Technology Innovation Strategic Alliance" was quietly held in Xuzhou. In this industry that has long been fully marketized and highly competitive, it is not easy to bring together many key companies.

However, China's construction machinery industry has come to the present, and the key component parts' long-term dependence on imports is an unavoidable bottleneck for the industry. If it is in line with the development path of foreign companies, especially Japanese companies, to establish a common technology innovation and sharing platform for R&D, it may be worth trying. Of course, this requires companies to examine the relationship between competition and cooperation from a higher level.

Missing platform

Cranes are an important model in construction machinery. It is widely used in railways, highways, urban construction, and large-scale projects such as wind power and nuclear power, and is playing an increasingly important role.

At the same time, it plays a key role in the development of the entire construction machinery industry in China. Since 2004, China's crane market has maintained an average annual increase of more than 30%. In 2009, the industry’s sales revenue exceeded 30 billion yuan. This not only means that China has become the world's largest crane market, but also the world's largest exporter of small-tonnage crane products.

More importantly, unlike other construction machinery products such as excavators and loaders, the cranes produced in China not only achieved a significant increase in the number of international markets, but also won recognition in terms of quality. After learning and innovation in recent years, China’s crane companies are gradually rewriting foreign users’ knowledge of Chinese construction machinery. However, it is undeniable that there is still a large gap between the internationally renowned companies in terms of technological breakthroughs, product development, innovation capabilities, reliability research, manufacturing processes, and corporate management. This leads to China's crane industry is not strong, and profit is meager. And in the international high-end market, especially in oversized tonnage products, the competitiveness of our country's cranes is seriously insufficient.

The development and manufacture of core components such as engines, hydraulic components, and electronic control systems have become the most difficult problems at hand. Long-term dependence on imports has become the only choice for Chinese companies.

One view is that the current development situation in China, especially manufacturing, is very similar to Japan in the 50s and 70s of the last century. Therefore, the voice of Japan’s advanced enterprises for benchmarking has gradually increased in the past two years.

Looking back at the "introduction-digestion-absorption" path that Japanese companies have followed, compared to the same historical point, what we lack is cooperation. It is a common common technology research and innovation platform.

Give up dispute

Those who are familiar with Japanese construction machinery products may find that there are sometimes two or three company logos on a single machine, and these companies are even dead in the market on weekdays.

This will surely puzzle outsiders, especially Chinese counterparts. However, in fact, this is the product of the common technology research and development sharing platform of the Japanese construction machinery industry. In that year, Japan chose to cooperate in order to solve the historical breakthrough of core component technology. Under the guidance of the state, a number of enterprises have jointly invested in the establishment of several such industrial alliances to work together to break through and achieve success. At least, most of the hydraulic components and engines of China's construction machinery currently come from this neighbourhood that has become a strong player.

In fact, before 2005, China’s construction machinery industry had always lived in harmony with the original system of the Ministry of Machinery, and even shared each other’s “brothers”. Communication between companies in various ways and at all levels was frequent, and To some extent, it shows the unity and spirit of "unanimously returning to the outside world and recovering lost land." However, since Carlyle's acquisition of Xugong’s case was blocked by 31, the construction machinery industry in China has sparked smoke. Afterwards, the price war in the loader industry and the succession of stories of various grudges between some enterprises in the industry have pushed the so-called "competition" to a hot topic.

In fact, it is not surprising that you are competing with each other, even to a certain extent, to promote the progress of China's construction machinery industry. Unfortunately, such "competition" allows companies to abandon cooperation.

This eventually led to the success or failure of China's construction machinery industry, which is large, not strong, and marginally profitable.

Objectively speaking, investing heavily in R&D is risky for companies. However, in the current economic environment, relying on the input of individual companies to achieve technological breakthroughs is not realistic, and cooperation may be a way out. However, this requires mindset and the height and vision of examining the relationship between competition and cooperation.