Inside Front‑line Factories: China’s Construction Machinery Road to Revival

According to the list of 2021 Global Top 50 Construction Machinery Manufacturers released recently by the organizing committee of the Global Construction Machinery Top 50 Summit, amid the pandemic, the 11 Chinese manufacturers on the ranking achieved counter‑growth in sales revenue. For the first time, they overtook their U.S. counterparts, climbing from third place to No.1 worldwide.

Separately, data from globally authoritative research firm Off‑Highway Research showed that Sany Group sold 98,705 excavators in 2020, capturing 15% of the global excavator market share and claiming the global sales crown for the first time. This marked the first instance in excavator industry history that a Chinese brand reached the pinnacle of the world market.

How did China’s construction machinery manufacturing sector evolve, shifting from foreign excavator brands holding over 90 % of China’s domestic market to domestic brands taking the leading position? How is the industry breaking free from core‑technology bottlenecks? Reporters recently visited smart factories of relevant enterprises to observe on‑site industry dynamics and hold discussions with corporate insiders and industry experts.

Inside the excavator workshop of Sany Heavy Machinery at Lingang Industrial Park in Shanghai, hundreds of robots perform their designated tasks, undertaking cutting, welding, painting and other procedures. On average, one excavator rolls off each production line every seven minutes.

At the bright, clean No. 18 Lighthouse Factory within Sany Heavy Industry’s Changsha Industrial Park, green plants and fish ponds greet visitors upon entry. Here, eight major manufacturing processes are consolidated under one roof. Fully automated three‑dimensional logistics systems are deployed: heavy‑duty components travel through underground transport tunnels, while lighter parts are hoisted via overhead cranes. Compared with traditional workshops, headcount here has dropped by 67 %, yet production capacity has doubled.

“Domestic sales accounted for nearly 90 % of Sany’s total excavator sales in 2020. This was largely driven by China’s early success in containing COVID‑19 and its subsequent economic recovery,” noted Xiang Wenbo, President of Sany Heavy Industry Co., Ltd., in an interview. On one hand, the Chinese government rolled out policies including the “Six Priorities and Six Stability Initiatives” and ramped up investment in infrastructure, generating substantial market demand for construction machinery. On the other hand, China’s accelerating ageing population has accelerated the replacement of manual labour by machinery. The shrinking workforce in traditional infrastructure work has made excavators — serving as industrial robots — well‑aligned with market needs for labour substitution.

China began independent R&D on excavators in the 1960s, roughly at the same time as Japan. Nevertheless, constrained by weak industrial foundations, the industry long lagged behind global peers. Back then, domestically built machines were derided as little better than “industrial junk”, falling short across technology, craftsmanship, performance and quality. Prior to 2011, Japanese, American and other overseas brands still occupied more than 90 % of China’s excavator market. Today, Chinese brands hold roughly 75 % of the domestic market. Most construction‑machinery products including excavators and aerial work platforms have realized large‑scale import substitution, with export volumes rising year‑on‑year.

“What enabled the rise of China’s construction‑machinery sector? First, a complete domestic supporting industrial system has taken shape. Second, massive domestic engineering projects offer ample real‑world testing ground for local equipment. Third, Chinese machinery delivers strong cost‑performance compared with foreign alternatives,” explained Bai Ming, Research Fellow at the Chinese Academy of International Trade and Economic Cooperation, Ministry of Commerce. Years of market exposure and technological accumulation have greatly strengthened China’s construction‑machinery industry. “Even without the window of opportunity created by China’s post‑pandemic economic rebound, it would only have been a matter of time before Chinese manufacturers outperformed foreign brands in sales.”

At present, China’s domestic supply chain for construction machinery can satisfy main equipment manufacturers, alleviating long‑standing bottlenecks in key component supply.

“Hardware‑wise, hydraulic cylinders, hydraulic components and engines were classic bottleneck components plaguing our sector. Sany has now achieved in‑house R&D and production for all these critical parts,” said Hu Qi, General Manager of Sany Heavy Machinery’s Medium Excavator Division.

Hydraulic systems represented the most severe pain point for domestic excavators. Around 2015, U.S. hydraulic suppliers imposed various supply restrictions on Chinese manufacturers. Before 2011, China’s excavator output was largely determined by how many components the world’s two major international hydraulic cylinder suppliers allocated to the Chinese market. “We invested about five years into independent research and finally mastered hydraulic‑system technology, and can now produce the full range of hydraulic cylinders domestically.”Sany Excavator Undercarriage Parts

Jiang Qingbin, Deputy General Manager of Sany Pump Business Unit, pointed out that concrete pump trucks also faced core‑component constraints. The boom of a pump truck can extend up to 86 metres, calling for steel that is both lightweight and high‑strength to avoid fracture. “We once relied entirely on expensive imported steel. Today we use commercially available ordinary steel, which we process in‑house into high‑strength steel plates through proprietary treatments.”

Before 2019, over 70 % of chassis fitted on Sany pump trucks came from foreign brands including Dongfeng, Mercedes‑Benz and Volvo. Now, 75 % of pump trucks adopt Sany’s self‑developed chassis technology. “Pandemic‑era market disruptions forced us to make full advance payments six months ahead for certain imported chassis, with delivery only after half‑a‑year. Lead times were prohibitively long. That pushed us to deploy our internally reserved chassis technology,” Jiang Qingbin elaborated.

Engine performance is central to chassis capability: higher‑precision engine machining reduces fuel consumption and noise. Hydraulic parts are equally vital. Poor‑quality hydraulic components cause violent shaking during pumping operations, creating erratic output displacement where concrete may land metres away from the target point. “Japanese firms excelled in this domain, yet we can now manufacture such parts ourselves.”Excavator Track Roller

According to Jiang Qingbin, Chinese‑brand small‑, medium‑ and large‑sized excavators match global leading competitors in technology and quality. Chinese OEMs excel in rapid after‑sales service response, while overseas brands benefit from longer‑term technology heritage and established customer bases.

Nevertheless, ultra‑large excavators remain a weak spot for Chinese manufacturers. Japanese suppliers build 800‑tonne‑class models whose buckets move 42 cubic metres of earth per dig — equivalent to the volume of a large room. Domestic manufacturers currently top out at the 200‑tonne class. Ultra‑large excavators carry high profit margins and see extensive deployment in mining sites. Restricted partly by engine performance, Chinese enterprises also require further technical accumulation for ultra‑large equipment such as heavy‑duty pump trucks.Sany Excavator Bucket

While resolving core‑component bottlenecks, China’s construction‑machinery industry presses ahead with digital transformation. Reporters observed large display screens inside Sany’s smart factories showing real‑time operational status and production metrics across equipment.Sany Excavator Idler

Sany’s digital journey traces back to 2007, when welding robots were first deployed on its excavator production lines. After robot adoption, excavator after‑sales failures dropped by three‑quarters and service life quadrupled.Sany Excavator Track Roller

Liang Wengen, Chairman of Sany Group, once remarked that facing digitalisation within construction machinery and manufacturing, Sany would either sink or thrive. He identified two historic opportunities for the sector: the great rejuvenation of the Chinese nation, and the industrial opportunities brought by Industry 4.0. The convergence of these two forces will reshape the construction‑machinery industry, underpinned by digital transformation.Sany Excavator Undercarriage Parts

“We remain a China‑based enterprise rather than a true global‑level player. Overseas sales account for merely around 20 % of group revenue. In the coming years, we aspire to build another Sany Heavy Industry overseas and earn genuine recognition as a world‑class brand among international customers,” Xiang Wenbo stated.

In Jiang Qingbin’s view, low global brand awareness constitutes the main barrier for Chinese construction‑machinery firms going global. Huawei’s mobile‑phone sales overtook Apple within just a few years, built upon more than two decades of prior technological accumulation. The same logic applies to construction machinery. “I am convinced that following sustained technical investment, global recognition for Chinese brands will see explosive growth after a period of gestation.”Excavator Track Roller

“Over decades of development, construction machinery has expanded from early bulldozers, road rollers and conventional cranes to a wide array of specialised and multi‑functional machines,” Bai Ming commented. The sector has largely completed its industrial layout and will further move toward specialisation. Increasing integration with other industries will spawn more custom‑built equipment. For instance, joint R&D with coal enterprises yields mining‑specific machinery; partnerships with fire‑fighting authorities produce hardware for high‑rise emergency response. As living standards improve, micro‑sized machinery may enter households to support home gardening and similar domestic applications.”

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