Textile Machinery Industry: Drop of Data and Reality

According to the statistical data of 676 textile machinery enterprises by the National Bureau of Statistics, from January to September this year, the total output value of the textile machinery industry was 77.48 billion yuan, up 28.48% year-on-year; the sales revenue of products was 76.212 billion yuan, an increase of 28.36% year-on-year. The total profit was 4.847 billion yuan, a year-on-year increase of 34.15%. From January to September, textile machinery exports reached 1.652 billion U.S. dollars, an increase of 33.04% year-on-year.

If only from the above data, we seem to have no reason not to believe that this year's textile machinery industry is a bumper year and a year of great satisfaction and hope for all textile machinery companies. However, since the fourth quarter, the noticeable decline in sales of textile machinery and the sudden decrease in new orders have caused the owners of many textile machinery companies to be extremely uneasy. They summed up their feelings about the textile machinery market this year in three sentences: Well, it feels bad; order is good, efficiency is not good; immediate good, bad trend.

The data is good, I feel bad?

Regardless of the figures of the National Bureau of Statistics, or the financial statements of enterprises, the year-on-year increase in the sales of textile machinery in the first three quarters of the year or even the entire year is already a foregone conclusion. But in the face of good-looking data, the reason why everyone feels bad is that companies in the market have already felt the “cold” market, but statistics cannot keep up, and they cannot keep up. Due to the special nature of the machinery manufacturing industry, most orders have a delivery date of 3 to 6 months. Therefore, a large part of the production and sales data of textile machinery companies this year reflects the demand situation of last year.

Orders are good, the efficiency is not good?

Businesses receive more orders than they earn more money. Such a problem that is not a problem is really a big problem in the textile machinery industry. In the first three quarters, orders for most textile machinery companies were still full due to the inertia effect of the shortage of supply in 2010. However, rising raw material prices, labor costs, and production factor costs have severely squeezed the profit margin of textile machinery companies. Along with the increasing competition from homogenized products, the prices of textile products have been difficult to increase. As a result, most textile machinery manufacturers, especially those engaged in cotton spinning equipment, have become large and thin, and some companies have even fallen into a loss situation. In the face of orders, is it connected or not? After taking the loss, he lost his client. Businesses have a dilemma.

Fortunately, the trend is not good?

After entering the fourth quarter, although orders in the hands of textile machinery companies are sufficient to ensure that full-load production can still be maintained beforehand, the reduction of new orders and the delayed delivery of individual orders have led many companies to feel that the “cold stream” has come. Many companies even believe that this time the "cold stream" is more ferocious than the 2008 financial crisis. The economic environment in 2012 was more complicated than in 2009. On the one hand, what we are most worried about is the impact of the European debt crisis; on the other hand, the impact of the price fluctuations of cotton and other raw materials and rising labor costs on the investment of textile companies. It is also inevitable.

The good-looking data in the textile machinery industry and the current reality of textile machinery enterprises have formed a huge gap. The textile machinery companies seem to have no time to enjoy the joy brought by the data, and have paid more attention to the future.

Production and sales: orders still full growth slow down data analysis:

According to statistics from the National Bureau of Statistics on 676 textile machinery enterprises, from January to September 2011, the industrial output value of the textile machinery industry was 77.488 billion yuan, an increase of 28.48% year-on-year; the industrial sales value was 75.226 billion yuan, a year-on-year increase of 28.29%; The production and sales rate was 97.08%. The textile machinery industry realized sales revenue of 76.212 billion yuan, an increase of 28.36% year-on-year; from January to September, the per capita product sales revenue of the textile machinery industry was 575,100 yuan, an increase of 20.89% over the same period of last year. The main business incomes of Jiangsu, Shandong, and Zhejiang provinces were respectively 22.798 billion yuan, 18.349 billion yuan, and 9.337 billion yuan, accounting for 66.22% of the country's total.

Reporter's commentary:

In the first three quarters of this year, the textile industry was not fully reflected in the sales of textile machinery products due to monetary tightening policies and cotton price fluctuations. The sales of most companies continued the good momentum of last year.

The reason why the textile industry's market sales can maintain the momentum of strong growth is because textile companies have continuously increased their efforts in product structure adjustments and are constrained by the rise in labor costs in recent years. They have become increasingly automated, continuous, high-speed, and intelligent. There is a strong demand for upgrading of large-capacity textile machinery equipment. This year's significant increase in the sales of clean carding, compact spinning, spinning dolers with collective doffing, warp knitting machines, etc., all reflect these characteristics and advantages, and can fully satisfy the textile industry from labor-intensive to technology-intensive. The need for change. Second, because last year's textile products were in short supply, orders were transferred to this year. Therefore, a large part of the products sold by many textile machinery companies in the first half of the year fulfilled the contract orders last year. In addition, there has been a direct correlation between the sales of some textile products this year and the volatility of cotton prices this year. The fall in the price of cotton once again caused many cotton spinning companies to dare to buy cotton and change to chemical fiber and viscose projects. Chemical fiber filaments, staple yarns and texturing machines all showed a year-on-year increase in sales in the first three quarters of this year. However, in the first half of this year, sales of several kinds of textile machinery equipment were also unsatisfactory, especially for printing and dyeing equipment. Due to fluctuations in cotton prices, tight electricity usage, increasingly stringent environmental protection requirements, and tightening monetary policies, the operating rate of printing and dyeing companies continued to decline, and the purchasing power of equipment was significantly weakened.

In spite of the favorable conditions for production and sales of the textile machinery industry in the first three quarters of this year and sufficient orders, due to the impact of the tightening monetary policy of the country, the phenomenon of delayed delivery of textile enterprises has occurred from the second half of the year, especially since October. Severely, new orders for textile machinery companies have been significantly reduced. Therefore, the actual situation of the textile machinery companies is now very different from the data of the National Bureau of Statistics of the previous three quarters.

Corporate perspective:

China Hengtian Group Co., Ltd.:

In the first three quarters of this year, the textile machinery market performed well. All companies affiliated with the Hengtian Group had adequate orders, but the phenomenon of delayed delivery by customers occurred from time to time. Especially after October, new orders abruptly decreased. This situation continued until the fourth quarter. It now appears that there will not be much improvement in the first quarter or even the first half of next year. In my opinion, the change in the textile machinery market is a normal reflection of the global macroeconomic ups and downs. The market needs to be adjusted. For enterprises, they must take the initiative to adapt and find a way out for development. Hengtian's measures are to strengthen the R&D of technology and produce more efficient textile products. At the same time, we must look wider and farther and continue to open up foreign markets.

Jiangsu Niupai Textile Machinery Co., Ltd. Deputy General Manager? :

Our company continued the good momentum of production and sales last year for the first three quarters of this year, but it has clearly declined from the fourth quarter. This makes us feel very uneasy now. The textile industry re-emerged in winter, and the ferocity of the situation seems to be no less than 2008. The global economic situation continues to be unstable, it should be said that it has never been out of the financial crisis, and now coupled with the European debt crisis, the textile industry has become the brunt of the affected industries. Since the beginning of this year, the tightening of monetary policy in China has also made it difficult for the textile industry, which is dominated by SMEs. After December, despite the loosening of financial policy, there will be no fundamental change. As a textile machinery company, we should make full use of the timing of this downturn. On the one hand, we need to reposition our products. On the other hand, we must fine-tune our products and make brands.

Jiangsu Hongyuan Textile Machinery Co., Ltd.:

In the first three quarters of this year, the sales of texturing machines and roving machines produced by our company were very good and we have completed the tasks for the whole year. However, the fluctuations in the market also have an impact on us. For example, there has been a delay in picking up since the second half of the year. Since the fourth quarter, orders have decreased significantly compared to last year. In my opinion, it is inevitable that industry investment is going down. The ups and downs in the market are also normal. We need to adjust our attitudes and respond positively. In the future, the demand for products in the market will certainly not be the same as now. Textile enterprises need energy-saving, efficient and modular textile products. We can make full use of this buffer period to further improve and improve existing products and prepare for the next round of market recovery.

Song Risheng, general manager of Song He Song Science and Technology Applied Engineering Co., Ltd.:

This year, the company’s orders, exports, output value, sales, and profits increased substantially year-on-year, mainly due to the increased investment in R&D in China, improvement and optimization of existing products, and accelerated development of new products; the company visited old customers. Many old customers have added additional orders; the development of new markets has been strengthened, and the products have been unanimously recognized by new and old customers.

Affected by the textile industry's operating situation, the textile industry in 2012 may continue to be weak, which is a challenge for us. However, there are still many gaps and demand points in the market that require us to further explore. Next year, we will increase the development of new markets, provide better services to our old customers, increase investment in research and development of new products, improve and improve old models, improve product quality and production efficiency, and design outstanding models. We will increase our own brand value, strengthen internal management, and strictly control quality. We believe that our sales will achieve even more brilliant results next year.

Tong Wei, Chairman of Tonghe Textile Machinery Manufacturing Co., Ltd.:

In 2011, Tonghe’s output value increased by 32% compared with 2010, and its sales exceeded 300 million yuan, a 30% increase over 2010. This is the highest annual sales revenue of Tong He’s company in 12 years. The profit increased by 10% from 2010.

The growth of the company's operating conditions in 2011 benefited from the key support from the National Twelfth Five-Year Plan for key textile machinery parts and high-end textile machinery equipment. On the other hand, the company benefited from the company's internal management.

In the first half of 2011, the company's roller, cradle, and compact spinning products all rose steadily and steadily, and continued to maintain the advantages of production and sales. Since June, the company's roller and cradle orders have declined, but orders for compact spinning products have continued to climb and have doubled. The monthly orders for compact spinning have reached 200,000 spindles, which has driven the sales volume of rollers and cradle. .

Xu Ping, general manager of Changde Textile Machinery Co., Ltd.:

This year, our company has sold more than 3.3 million cradle sets and sold more than 3.3 million cradle. The spring and air pressurized cradle products have shown a good production and sales situation. Warp knitting machine equipment also signed a large number of contract orders, orders have been scheduled until the end of 2012.

This year's warp knitting machine equipment can achieve such sales performance mainly in both internal and external factors. The external aspect mainly lies in the increasing demand for warp-knitted fabrics among domestic and foreign markets; the warp-knitted industries in Europe, America, Japan and other developed countries are rapidly shifting to developing countries, especially the rapid development of China's warp knitting industry. The intrinsic factors are mainly the company's dominant position in the domestic warp knitting machine manufacturing industry, with its brand advantage. The warp knitting machine is energy-saving, environmentally friendly, highly efficient, and has a good price/performance ratio. The variety is complete, and it can meet the needs of different high-end and mid-end users.

The role of national regulation and control policies in the real economy is obvious. In particular, under the influence of monetary tightening, the downstream textile companies are under strained funds, the operating rate is not enough, and the progress of technical reform projects has slowed down. The demand for the cradle market of our company is gradually declining, which has a certain degree of restraining effect on the speeding-up of warp knitting machine customers. .

Profit: The price is weak

From January to September 2011, the total profit of the textile machinery industry was 4.847 billion yuan, a year-on-year increase of 34.15%; the loss of the loss-making enterprises was 172 million yuan, a year-on-year decrease of 11.08%; the loss was 10.65%, an increase of 2.37 percentage points year-on-year; per capita The profit was 36,764.90 yuan per person, an increase of 27.97% over the same period of last year. Among them, Jiangsu, Shandong, and Zhejiang provinces achieved total profits of 1.731 billion yuan, 927 million yuan, and 755 million yuan respectively. The total profits of the three provinces accounted for 70.42% of the total profit of the textile machinery industry in the country.

Reporter's commentary:

This year, the total profit of the textile machinery industry has increased by 34.15% year-on-year, which is directly related to the increase in sales, and does not indicate that the company's profits are good. Judging from the actual situation, most companies, especially cotton spinning equipment manufacturers, are in fact producing bumper crops, and some even lose money.

From last year to this year, the domestic CPI index has continued to rise, and labor costs, machine materials, and coal, electricity, and oil transportation prices have risen. However, textile products alone have persisted at prices that are not high at all. In fact, the textile machinery companies do not want to increase prices. At the beginning of this year, when the orders of textile machinery companies were too much to come by, they had also discussed the need for collective price increases, but as the textile market turned from warm to cold, the price increases It is also temporarily stranded. In fact, even if the textile market continues to be as hot as last year, the price increase of textile machinery products cannot be achieved. Homogenization competition is one of the main reasons leading to the rise in prices of textile products. In China, there are at least twenty or thirty companies that produce the same type of textile machinery products, and the products produced by these companies are mostly identical and lack personality. In order to expand their market share as much as possible, textile machinery companies not only do not increase prices but also lower prices. As a result, the profit margin of textile machinery companies is constantly being squeezed, and the profit rate has even dropped below 5%, which is far lower. The average level of machinery manufacturing.

The bumper harvest is not a good harvest. This is an old problem that makes the whole industry feel sad. It now appears that it is obviously very difficult and very passive to earn more profits by reducing costs; the active approach should be to comply with the development trend of the textile industry, and to develop and produce textile companies with the main effects, energy conservation and automation required. High equipment. The reason why the price of the automatic winder for Qingdao Textile Machinery Co., Ltd. can rise by 20% is due to the fact that the domestic automatic winder technology is mature and can only form mass production. They have reason to grasp the price of the right to speak.

Corporate perspective:

Jinan Tianqi Special Flat Belt Co., Ltd. General Manager Wang Lanxi:

In the first half of this year, textile equipment orders were sufficient, and the supply of products was in short supply. However, in the second half of the year, especially in September, the textile enterprises had a significant downtime and half downtime. The rate of downtime of water-jet looms reached more than 50%, and the aftermath of the economic crisis gradually began to show up. Of course, there are many bright spots in the market since this year, such as the double-twisting machine for the filaments, and the air-jet looms are relatively good, which has also led to the corresponding equipment sales. In fact, no matter how the market changes, for textile machinery companies, it is still necessary to focus on the quality of the main business. The popularity of Chinese-made brands needs to be improved. It takes a long process. The flat belts produced by our company can be ranked in the top three in terms of scale and quality in the world, and have been allocated to Murata's automatic winder, but people's equipment does not hit our brand. Therefore, it is not our goal to merely sell sales. We want to build a brand so that the added value of our products can rise and profits can grow.

General Manager of Hangzhou Textile Machinery Co., Ltd. Ye Wen:

The sales of our company's silk reelers this year were basically the same as last year. I have three words about the overall feeling of the textile machine market this year: "The data is good, I feel bad; the sales are good, the efficiency is not good; the immediate good, the trend is not good."

The sale of textile machinery products depends entirely on the market situation of upstream companies. Last year, the price of raw silk rose from 200,000 yuan/ton to 400,000 yuan/ton. Silk companies made money and equipment sales also increased. This year, raw materials fell and fell again, and silk companies began to lose money. Now, the profitability of a company seems to have little to do with what kind of product it produces, but rather whether the timing of your purchase of raw materials is appropriate. This year, due to the declining prices of raw silk, although our company's orders for the first half of next year are all full, I am not at ease and I don't know how long this situation will last.

Chen Fengzhen, Marketing Director of Guangdong Fengkai Machinery Co., Ltd.:

The company’s main product sales price was flat compared with last year, and its profit was reduced. The profit rate was about 5%, which was lower than the same period of last year. This year, the company's production capacity has increased by more than 10% from last year. The overall production and operation status of the company is good. At present, the main problems in production and operation are that the demand in the international market is insufficient, the demand in the domestic market is insufficient, and the price of raw materials fluctuates sharply. However, the order volume of enterprises is basically consistent with the production capacity, and the order of intention in the future is relatively satisfactory.

Exports: Increase in quantity, low profitability, data:

From January to September 2011, China's textile machinery exports reached 1.652 billion U.S. dollars, an increase of 33.04% year-on-year. Knitting machinery exports amounted to US$480 million, an increase of 35.95% year-on-year, and the growth rate dropped by 12.15 points over the first half of the year, accounting for 29.06% of the total, ranking first, followed by auxiliary devices and spare parts, printing and dyeing and finishing machinery, and spinning. Yarn machinery, chemical fiber machinery, loom, nonwoven fabric machinery and weaving preparation machinery. From January to September, China exported textile machinery products to 165 countries and regions, of which the top five countries and regions were India, Japan, Bangladesh, Indonesia, and Pakistan, which accounted for 50.16% of total exports.

Reporter's commentary:

At present, the major markets for export of textile machinery products in China are still concentrated in the Southeast Asian market. In the first three quarters of this year, textile products exported to India, Japan, Bangladesh, Indonesia and Pakistan accounted for 50% of the total textile machinery exports. In the context of the unstable global economy, the demand for these markets is not satisfactory. Therefore, in this case, it is not easy for China's textile machinery exports to maintain a growth rate of 33%. This is because, in recent years, the manufacturing level of domestic textile machinery has been continuously improved, and cotton spinning, chemical fiber, and other equipment have been highly competitive in terms of cost performance. The second is that foreign advanced textile machinery manufacturers invest and build factories in China, which has made China's long-standing weaker post-printing and finishing machinery and knitted machinery technical levels have increased by leaps and bounds, and the export of products has shown a trend of rapid growth, which has also become more abundant. China textile machinery industry export product types. Third, China's textile machinery products continue to increase their international supporting capabilities. This can be seen from the year-by-year growth of auxiliary devices and spare parts exports. Auxiliary devices and spare parts produced by domestic companies are not only exported to foreign textile companies, but some internationally renowned textile machinery manufacturers also purchase China's spare parts for their mainframe.

In the first three quarters, the major increase in China's textile machinery exports was also due to the increase in product prices. However, in spite of this, the export price of textile machinery products in China is still generally low. At present, the average profit rate of China's export textile machinery products is only 2% to 3%, while the European company's profit rate is between 8% and 15%. The result of low prices must be squeezed out of the after-sales service of the product and the R&D expenses of the enterprise. This not only makes the enterprise profitable, but also directly affects the improvement of the level of textile machinery products in China. From a development point of view, companies should still take a long-term perspective and ultimately rely on the overall competitiveness of cost, quality, and innovation capabilities to win the market.

Corporate perspective:

Wu Xiuhua, Deputy General Manager of China Textile Machinery and Technology Import & Export Co., Ltd.:

This year, the overall export situation of CTMTC's exports has been stable, with export of textile machinery worth about US$150 million. The biggest highlight of this year is the export of 1,000 air-jet looms to Indonesia, which has now shipped 300.

The situation in the entire international textile market this year is similar to the domestic situation. In particular, the main export markets of textile machinery, such as India, Vietnam, Indonesia, and Pakistan, are affected by the sluggish European market, and the investment rate has slowed down. Coupled with the continuous appreciation of the renminbi in the first half of this year, we have been very cautious in taking orders in May and June. If it is delivered before the end of December, the basic delivery will be abandoned next year. With the outbreak of the European debt crisis, most companies are waiting to see orders for next year. Therefore, the export situation next year will be even more severe.

Chen Fengzhen, Marketing Director of Guangdong Fengkai Machinery Co., Ltd.:

This year, the company's main business income was the same as that of the same period of last year. We expect the situation will be basically the same next year and this year.

Although the company’s orders have decreased compared to last year, orders from abroad have increased, with an increase of about 10%. According to the current feedback, we expect the company's foreign orders will continue to increase next year. The output value of Fengkai’s export sales this year is 8%, slightly higher than last year.

Chongqing Chong Mao Textile Equipment Co., Ltd. Chairman Yang Chongming:

As of November of this year, compared with the same period of last year, the gross industrial output value of Golden Cat increased by 54.42%, the industrial added value increased by 38.12%, the sales fund recovered by 55.11%, and the total profit, total export value, and taxes paid were higher than the previous year. In the same period, there was a substantial increase. This is the best result my company has achieved in recent years.

Due to the world economic recession caused by the debt crisis in Europe and America, it is impossible to reverse in the short term. In addition, the Chinese textile industry is affected by a series of unfavorable factors such as the sharp fluctuations in raw material prices, the sharp increase in labor costs, the shortage of labor and capital, and the weak demand in foreign markets. A considerable number of SMEs will be in semi-discontinued production and production shutdowns. The situation is very serious. Companies that have long attached themselves to textile equipment will inevitably be affected. Chongqing Golden Cat is no exception.

There will be challenges and opportunities next year. The relevant policies put forward by the Central Economic Work Conference on encouraging and supporting the real economy and supporting the development of SMEs have brought about a glimmer of hope for the textile SMEs that are in the midst of difficulties. The textile machinery enterprises have applied a good policy and practice hard. Be prepared to meet the challenge.