According to research conducted by relevant industry experts, in recent years, with the rapid development of China's equipment manufacturing industry, it has become the main driving force behind the rapid growth of the national economy. In 2007, the total output value of China's equipment manufacturing industry reached 11.94 trillion yuan, accounting for 33.77% of the total industrial output value of the manufacturing sector, surpassing Japan and Germany to rank second in the world.

In the three backbone industries of manufacturing, mining, and construction, manufacturing is the foundation, while equipment manufacturing is the "foundation of the foundation." In 2008, the sudden global financial crisis had a certain impact on China's economy, causing economic growth to slow down. In response to this financial storm, China introduced a series of policies and measures to stimulate domestic demand and maintain steady and rapid economic development. Among them, the State Council's 4 trillion yuan "growth-guaranteeing" measures stimulated a new round of investment enthusiasm among local governments. Currently, various local governments have announced large-scale investment blueprints: Shanghai with 500 billion yuan, Jilin with 400 billion yuan, Hainan with 207 billion yuan, Anhui with 389 billion yuan, Zhejiang with 350 billion yuan, Hebei with 588.9 billion yuan, Henan with 1.2 trillion yuan, Liaoning with 1.3 trillion yuan, Chongqing with 1.3 trillion yuan, and Guangdong with 2.3 trillion yuan. Jiangsu's plan is to complete 300 billion yuan by the end of 2009 and invest another 650 billion yuan in 2010. According to the data already announced by various regions, the total fixed assets investment announced by provinces, municipalities, and autonomous regions across the country has exceeded 10 trillion yuan, far exceeding the target set by the State Council of stimulating local and social investment to reach 4 trillion yuan.

According to the central government's deployment, the top priority of the newly increased investment this time is the people's livelihood projects. "Accelerating the construction of affordable housing projects" ranks first in the "Ten National Policies". In the investment blueprints announced by local governments, the focus remains on infrastructure projects such as railways, highways, power plants, and real estate, which are directly related to the construction machinery industry, involving concrete machinery, excavators, truck cranes, and loading machinery. In addition to the aforementioned machinery, affordable housing and infrastructure construction also involve other types of machinery such as bulldozers, and their market demand will see significant growth, indicating a vast future market.


"4 trillion yuan" boosts the machinery industry. According to industry insiders who analyzed the impact of this fiscal policy on the demand for construction machinery through scenario assumptions, the proportion of infrastructure spending on construction machinery procurement in 2009 to domestic construction machinery sales revenue in 2008 was approximately 30.3%. The major contributions of the "Ten Measures" to the construction machinery industry lie in infrastructure construction such as railways, transportation, and water conservancy, as well as post-disaster reconstruction and low-rent housing construction. Overall, these measures drove construction machinery sales to reach 44 billion yuan, an increase of approximately 18% compared to domestic sales in 2008.
       The specific manifestations are as follows: First, railways are the focus of this round of infrastructure expansion. It is estimated that railway investment will reach 600 billion yuan in 2009, with an additional investment of about 300 billion yuan, which can generate a demand for 15 billion yuan of new construction machinery. Second, road and transportation construction. According to the Ministry of Transport, the scale of fixed assets investment in road and transportation will remain at 1 trillion yuan in 2009, with an additional fixed assets investment of 200 billion yuan, which can generate a demand for 12 billion yuan of new construction machinery. Third, post-disaster reconstruction. According to the newly issued "Special Plan for the Restoration and Reconstruction of Infrastructure after the Wenchuan Earthquake", 167 billion yuan will be invested in the disaster area during the three-year reconstruction period, with an average annual investment of 55 billion yuan. In 2009, the demand for new construction machinery is about 2.2 billion yuan. Fourth, affordable housing construction. This round of economic stimulus plan focuses on the construction of low-rent housing for affordable housing. We estimate that the average annual investment will be 300 billion yuan in the next three years, which can generate a demand for about 12 billion yuan of new construction machinery.