Analysis of Development of High Efficiency Cutting Tool Market in China

The status quo of the development of China's tool industry and the status quo of the contradictions of China's tool industry can be regarded as a microcosm of the macro economy. On the one hand, great progress has been made in the past 30 years of reform and opening up. Especially since the beginning of the new century, this kind of development has been accompanied by a qualitative improvement and the momentum is very good.

However, it should be noted that the current dominant position in the tool industry is still the extensive development of resource consumption; in 2007, China's high-speed steel consumption was 80,000 tons, and cemented carbide consumption was 16,500 tons. These two kinds of tool materials are It accounts for 40% of the world's consumption. However, the sales of cutting tools in China only account for 15% of the global total. This contrast fully reflects the degree of extensive development of the industry and the serious waste of resources.

For example: HSS cutting tools, China produced 4 billion pieces in 2007, which is an astronomical figure in the global tool industry, which is 50 times that of the large industrial country Japan (in 2007 Japan produced 85 million high-speed steel cutting tools), production What are so many tools? Most of them (80% of the total) were exported as home kits. High-speed steel consumption of 65,000 tons (of which 20,000-30,000 tons is estimated to be low alloy counterfeit high-speed steel) exchange of 800 million US dollars, cheaper than the international market materials, rely entirely on the state tax rebate subsidies to live.

Another example is that carbide cutting tools are the main force for the development of modern high-efficiency cutting tools in China. In recent years, the average annual growth rate has exceeded 30%. Some high-end products meet the development needs of modern manufacturing, and the development momentum is good. However, the overall level is still low. For example, of the 16,500 tons of cemented carbide produced in China in 2007, 4,500 tons were used for cutting tools, which is equivalent to Japan in quantity. However, the value of tools made in Japan is 2.5 billion U.S. dollars, and China is only 800 million U.S. dollars, less than 1/3 of Japan's. This shows that there is still a considerable gap between the overall level of domestic high efficiency carbide cutting tools and foreign countries. Therefore, the demand for manufacturing has to be solved by relying on a large amount of imports. In 2007, the import value reached 7.5 billion US dollars. The sales volume of major foreign companies in China has reached an annual growth rate of 30%, exceeding the average annual growth rate of domestic-made cutting tools.

The above situation shows that in the tool industry of our country, waste of resources, low level of expansion, and the status of extensive operations are still very serious. The implementation of industrial restructuring has become an urgent task.

The unreasonable pattern of “low-end melee and high-end fall” in the Chinese tool market can be clearly seen in the sales of domestic tools in 2007. In 2007, the sales revenue of domestic cutting tools was approximately 21 billion yuan***. Which exports 850 million US dollars. At the average exchange rate for the year, it was about 6.5 billion ***. Therefore, in 2007 domestic sales of tools in the domestic tool market was about 14.5 billion yuan***, of which carbide tools about 5.8 billion, accounting for about 40%. In the same year, the import of cutting tools was 750 million U.S. dollars, which was about 5.8 billion U.S. dollars. It is mainly carbide cutting tools. Therefore, in 2007, the consumption of cutting tools in China was about 20 billion yuan, of which the consumption of cemented carbide tools accounted for about 54%. From the above data, we can see that domestic tools have a market share of more than 70%. The share is not low. However, the current outstanding contradiction is that in the field of modern high-efficiency tool cutting, multinational companies still dominate. At present, the sales of cemented carbide high-efficient cutting tools in developed countries account for more than 70% of all cutting tools. The proportion of cemented carbide tools made in China's domestic tools accounts for only 40% of domestic sales. If the domestic and foreign sales total is even lower, it is only 28%. China's severely irrational tool product structure can be seen in general.

Medium and long-term development prospects - China will become the world's largest tool market, the rapid development of manufacturing, China's cutting tool market has great potential for development, the total is expected to exceed Germany, the United States, Japan, for the adjustment and development of China's tool industry, provide A full operating space.

In the development of modern high-efficiency cutting tools, it is necessary to pay attention to a wide range of cemented carbide tools, as well as to the use of superhard tools and high-performance high-speed steel tools that require rapid growth. In short, in the development of modern manufacturing, improving the quality and efficiency of processing is an eternal pursuit. The modern high-efficiency tool is the "high-precision, high-efficiency, high-reliability, and specialization" tool that serves this demand.

We believe that despite the cyclical changes and turmoil in the global economy. However, the major pattern of the transfer of manufacturing industries to China is based on the objective needs of optimal allocation of resources in the context of globalization and will not be reversed. At present, the output value of China's manufacturing industry is roughly between Japan and the United States. However, at the level of physical output, it has greatly surpassed Japan and the United States. China has ranked first in the world in machine tool consumption for five consecutive years.

In 2007, the number of machine tools in China has reached 5 million units, far exceeding that of developed countries, with 600,000 CNC machine tools. The number of machine tools is comparable to that of Japan and the US, but the grade is low. In developed countries, there is a consensus that the potential for efficient tooling to exploit digital manufacturing technology is already in place. Annual tool consumption is about 50% of machine tool consumption. In China, the consumption of cutting tools and machine tools consume 320%. Explain that in China's tool consumption, cheap and inefficient traditional tools still dominate the market. Machine tool functions are far from being fully realized, and manufacturing has great potential for increasing labor productivity. This is not only the gap between China's tool industry, but also the use of China's tool industry. The golden key to the development of China's large tool market is the development of modern and efficient tools to replace cheap, inefficient conventional tools.

Through the above analysis, we can clearly see that the biggest opportunity facing the Chinese tool companies is that there is a largest global tool market at our doorstep, which provides sufficient space for our development. However, we are facing severe challenges. The modern and efficient tools that the market needs are very slow. We cannot meet the needs of the manufacturing industry and have to import large quantities. Traditional tools that do not meet the needs of the development of modern manufacturing; hacking tools, but blind development, the total out of control, the formation of a surplus, low-cost competitive marketing passive situation. Therefore, there is only one way out for China's tool industry. It is to develop modern and efficient tools, realize structural adjustment and industrial upgrading, and get rid of low-level and duplicative development paths.

Since the beginning of the new century, the Chinese tool industry has begun the process of structural adjustment and industrial upgrading, but the pace of progress is too slow. Faced with the challenges of the new economic situation, enterprises in the vast number of industries must have a sense of urgency and must speed up adjustments. Develop a potential Chinese tool market. To achieve this, the scale of China's tool market will surpass Japan, the United States, and Germany. In doing so, not only will China's tool industry grow stronger, but China's manufacturing industry will greatly increase production efficiency and competitiveness through the extensive adoption of modern and efficient tools. The benefits obtained are far higher than those of the tool industry and it is a win-win situation.

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