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Homegrown heavy machines paving the way to success

Homegrown heavy machines paving the way to success

Write: Merrill [2011-05-20]

Accolades for Xuzhou's high-tech road equipment

China continues to build impressive new infrastructure across the nation - yet most of the machines used to build the roads, rail beds and bridges remain overwhelmingly foreign.

But that is beginning to change with several domestic manufacturers making inroads of their own.

Among them is Xuzhou Construction Machinery Group, maker of the top machines among the best 50 announced in Beijing on March 16 as selected by industry media.

The company's fourth-generation road construction machines are now widely used on huge Chinese projects including expressways built in the west and a transportation hub in Shanghai.

"To gain a foothold in the market we began to develop the latest-generation of machines," said Tao Yongsheng, a vice-chief of the company's technology operations.

He cited Xuzhou Group's computer-controlled RP1356 asphalt concrete paver as an example of improved quality and advanced technology.

Yearly demand for such top-end large pavers is only about 200 machines, even in China. The company sold about 45 in 2010, a number projected to grow to 70 this year, he said.

Though it has "mature technologies" and "manufacturing expertise", Xuzhou Group still needs to import key components, according to the vice-chief.

Wide use of automated controls in the latest lineup has resulted in a considerable rise in quality, operational effectiveness and environmental friendliness, Tao said.

The developments "mark the era when Chinese construction machine makers became a major force", according to the award committee.

Xuzhou Group also took awards in two other categories, for technology innovation and applications.

Innovation

Technological innovation, application and market performance were the three key considerations factored in to select rankings in the global top 50 construction machines.

Well-known name Hitachi from Japan was the only foreign brand to receive an individual award.

Hitachi innovated the engine in its hydraulic excavator ZX200-3G, enabling the massive machine to operate smoothly even when quality fuel is not available, said Akihiko Hiraoka, managing director of Hitachi Construction Machinery (Shanghai) Co Ltd.

"Normally, we invest 3 to 5 percent of annual sales revenue in research and development," Hiraoka told China Daily.

Not all manufacturers are able to supply entire systems including spare parts, training, maintenance and other after-sale services, he said.

"As the Chinese government is committed to balancing development between developed and poor areas and increasing infrastructure, not only in coastal regions but also deep inside the country, we are quite confident in steady growth in demand in China," he said.

The excavator market is expected to surpass 200,000 units, with foreign brands supplying more than 130,000 of them, he said.

The recent disasters in Japan won't affect the company's Chinese operations "very deeply", as most of its Japanese production sites are not in quake-hit areas, but in Tokyo and western regions, Hiraoka said.

"There are no problems for parts supply in the coming one or two months as our factory has enough stock," he said.

The company now has established production facilities in Hefei of Anhui province and Tianjin. About 90 percent of its products are made in Hefei.

Part suppliers

In addition to machinery makers, part suppliers Cummins and Pfeifer also received awards.

Germany's steel wire rope maker Pfeifer founded its Chinese operation in Shanghai in 2006.

According to Zhang Hongtao, managing director of the Shanghai firm, it "cooperated with industrial associations extensively, offering technological training to those that were interested whether they were our customers or not".

China's construction machine industry generated more than 400 billion yuan (about $61 billion) in sales last year, a rise of nearly 30 percent.

This year's growth is still expected to surpass 15 percent, said Qi Jun, president of China Construction Machinery Association.