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13 November 2014

As one of China’s largest construction machinery manufacturers XCMG also has one of the broadest product ranges

First publishedin bauma China
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bauma China 2014 Preview XCMG’s road machinery compactor
XCMG's road machinery offering grew out from its compactor line and this range continues to benefit from development
XCMG is developing its presence in the road machinery sector – Mike Woof writes

The road machinery division of XCMG is an increasingly important part of the firm’s overall operations and now produces an extensive range of machines to meet customer needs. Guo Chaohui is vice general manager of this segment and said, “Our aim is to become a world class leader of road machinery. We want to introduce the company on the international market and raise the firm’s profile.”

XCMG already holds a strong position in the Chinese road machinery market but is keen to extend this worldwide. The extensive road machinery range includes soil compactors, asphalt compactors, asphalt pavers, milling machines and road maintenance equipment. The firm also includes its graders as part of its road machinery offering.

Investment in manufacturing capability has been substantial. XCMG’s new grader facility has the capacity to build up to 3,500 units/year, with production having commenced in May when the factory came on stream and replaced the company’s earlier plant. Chaohui said, “We have advanced production machinery.”

He continued, “We have the best assembly line for rollers in China and it can produce 10,000 rollers/ year.” He added that the firm’s asphalt paver facility and milling machine plant are also large and efficient, capable of producing 600 units/year and 500 units/year respectively.

The company’s grader range is another strong line and presently includes six models, the GR100, GR135, GR165, GR180, GR215 and GR300, with power outputs of 75, 101, 123, 134, 160 and 224kW respectively. XCMG claims market leadership in China for its grader line-up, offering an extensive range of models to meet the needs of the mass market for these machines. Meanwhile exports of the graders have also been steady, with significant sales into markets such as the Middle East and North Africa.
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bauma China 2014 Preview XCMG’s grader
XCMG's grader range is now extensive, with exports a priority and strong market shares in some key territories
XCMG has grown fast in the last 10 years and says that it is now the fifth largest construction equipment manufacturer in the world. The firm’s road machinery range is now well established and XCMG has been offering compaction equipment for 27 years, building its share of the Chinese market to 35% at present. Meanwhile the company has been producing pavers for 17 years and now claims to have a 30% share of the local market. And in the milling equipment sector, XCMG has been making units for six years, now claiming a 55% share of the Chinese market. In the grader segment, the firm has been building units for seven years and now claims a 40% share of the market.

In the past, XCMG worked with Western firms to develop its road machinery range. These partnerships ceased some years ago however and XCMG now improves its products in-house through its own research and development resources, aided by its 300 strong team of trained engineers. Chaohui said, “We have the widest range of road machinery products in China.” These products mainly extend through the mid-large equipment segments, covering the volume equipment segments. XCMG is also keen to emphasise the durability and reliability of its product range, which it says compares well with the best imported products for dependability.

As it was the first line in XCMG’s road machinery offering, the compaction equipment range is particularly broad, including soil, asphalt, pneumatic, compact and deadweight types. The firm has innovated too and for example, its 36tonne single drum roller is the world’s largest soil compactor. This product range is seeing continual development and XCMG is introducing new model compactors that will offer increased performance over earlier generation machines, with the first being introduced by the end of 2014.

The paver line is also modern and Chaohui said, “We have all kinds of pavers from the smallest to the largest.” He said that the largest paver in the range offers a maximum screed width of 12m, while the smallest is a more compact machine that has a screed which can extend to 3m. These models features tamper bar type screeds and are strong sellers in China, Africa and the Middle East.

However, the company does not make the US style pavers favoured in North and South America so its market penetration in Latin America for this range remains small. In the milling machine sector, XCMG has a good reputation in China for the diverse range, well as steady exports to the Middle East and Russia for its smaller units. For rest of the road repair market, XCMG produces high quality machines that can deliver high quality repairs, as well as more basic equipment to suit the needs of rural road repairs in developing countries. Soil types vary between Brazil and China so the firm has changed the designs of its equipment to accommodate local conditions, which has proven successful in boosting sales.

The concrete plants XCMG manufactures are for the moment at least, targeted solely at the Chinese home market. However the asphalt plants are sold in China as well as being exported and are designed to suit the needs of emergent markets.

A strategy promoted by the Chinese Government is for the country’s equipment producers to develop overseas sales rather than relying on the home market. XCMG says that its road machinery operation has been particularly successful in this regard, with around 30% of production being exported. Latin America, the Middle East and Africa have been the most important export markets for XCMG, with Africa showing particularly strong growth at present. This last has been aided by the success of Chinese contractors in Africa, with financing packages often supplied often supplied by Chinese banks.

The company is planning to increase its presence in North America, with two compactors being readied to meet the noise and emission requirements.

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