Electrification Wave: Can China's Construction Machinery Lead the Global Green Transition?

Release Date:2025-03-22

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Hello everyone, today we are going to talk about the export countries and markets of construction machinery. When it comes to export countries, Russia is the first. Russia has become the largest export destination for Chinese construction machinery in recent years. In 2023, exports to Russia reached US$6.058 billion, a year-on-year increase of 66.5%, accounting for 12.48% of China's total exports. This growth is mainly due to the withdrawal of European and American brands after the Russia-Ukraine conflict. Chinese equipment quickly filled the market gap with its cost-effectiveness and supply chain advantages. In the first quarter of 2024, exports to Russia exceeded US$1 billion, and the subsequent growth potential is still optimistic. In addition, Russia's abundant mineral resources and infrastructure needs also provide long-term demand support for construction machinery.

2. The rise of emerging markets: Indonesia, India and Brazil perform well

As the largest economy in Southeast Asia, Indonesia will be the third largest market for China's construction machinery exports in 2023, with exports increasing by 9% year-on-year in the first quarter of 2024. Its new capital construction, mineral development and RCEP tariff reduction policies (such as Indonesia's zero tariff clause that will take effect in 2024) will further drive demand growth. India and Brazil also performed well, with India's construction machinery sales increasing by 31% year-on-year in 2024, while Brazil's market expectations turned optimistic as the government announced a $200 billion infrastructure plan.

3. Deepening regional cooperation: The Belt and Road Initiative and RCEP become the core engines

Countries along the Belt and Road are the main exporters of Chinese construction machinery, accounting for 60.31% of total exports in the first quarter of 2024, mainly covering Southeast Asia, the Middle East and Africa. Although the exports of RCEP member countries have declined due to short-term demand fluctuations, long-term tariff preferences and location advantages (such as infrastructure demand in Indonesia and Vietnam) still have potential. In addition, Saudi Arabia and the United Arab Emirates in the Middle East have significantly increased their exports due to the oil economy driving the demand for mining equipment.

4. Challenges and opportunities coexist

The growth rate of the European and American markets has slowed down due to trade barriers (such as the US 301 tariffs and the UK anti-dumping investigation), but there is still room for demand brought by the North American infrastructure bill. Chinese companies circumvent barriers by building factories locally (such as XCMG in Brazil and Sany in Indonesia), while focusing on electric products (such as Sany’s cooperation with CATL) to improve competitiveness. In addition, general trade accounts for more than 70%, indicating that the export of high value-added products has accelerated and the foreign trade structure has continued to optimize.

In summary, China's construction machinery exports are centered on Russia, Southeast Asia and the "Belt and Road" market, driven by the demands of emerging countries and regional cooperation policies. However, it is necessary to cope with trade frictions and local competition challenges. In the future, electrification and global layout will become the key to breaking the deadlock.

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