Central Asia powers machinery revival
After weathering more than two years of weak domestic sales, China's heavy equipment giants are gearing up to pursue huge opportunities in Central Asia's infrastructure market.
The opportunities involve roads, housing and manufacturing facilities as Central Asian nations strive to achieve their goals in the areas of infrastructure, urbanization and industrialization.
Lu Chuan, vice-president of Jiangsu-based Xuzhou Construction Machinery Group Import & Export Co Ltd, said his company plans to invest 3 billion yuan ($490 million) in the Xinjiang Uygur autonomous region to build a large manufacturing base where it will make cranes, excavators and bulldozers for the Central Asian markets.
"We will invest another $7.5 million in Central Asia to set up a country branch in Kazakhstan within the next year," said Lu. "The money will also be spent to add local dealerships, service and distribution stations and warehouses and to support spare parts sales."
XCMG has focused on selling excavators, bulldozers, road rollers and wheel loaders for construction markets in Central Asia for seven years.
XCMG sold $150 million of equipment to five Central Asian nations in 2012. More recently, the company won a contract in June to supply 42 sets of equipment for rail construction in Kyrgyzstan.
International players such as Caterpillar Inc of the United States and Komatsu Ltd of Japan have been consolidating their presence by diversifying their localization strategies and sewing up alliances throughout Central Asia.
Wang Zhibing, general manager of Sany Heavy Industry Co (Kazakhstan) Ltd, said the current Central Asian customers need durable products and powerful engines that can cope with multiple tasks and tough road conditions.
Sany is China's biggest, and the world's sixth-largest, maker of construction machinery. Last year, it opened its Xinjiang manufacturing facility, where it aims to produce 12 billion yuan of goods by 2016. It is targeting markets in Central Asian and Northwest China.
The company is also expanding its product line to include wind power and coal chemical equipment, because Central Asia is rich in both resources.
Its Kazakhstan branch also plays a key role in supplying construction machinery to another four markets in the region. It has six dealerships in Kazakhstan. Wang said the number is expected to double in 2014.
"After Astana became the capital of Kazakhstan in 1997, the expansion of urban areas hasn't finished. The country is planning to build more railway and underground lines," Wang said.
Khanatbek, director of the Central Asia business department of Zoomlion Heavy Industry Science and Technology Co Ltd's Xinjiang branch, said many affluent individuals and companies in the Central Asian region are also keen to buy construction machinery to become contractors or to lease the machinery out.
Zoomlion sold $6.53 million worth of truck cranes and $7 million of excavators in Central Asia in 2012.
It will set up a sales company in Astana next year and a service and distribution center in Khorgas, a Xinjiang town near the border with Kazakhstan, to move closer to its customers in Central Asia.
Lu Chuan, vice-president of Jiangsu-based Xuzhou Construction Machinery Group Import & Export Co Ltd, said his company plans to invest 3 billion yuan ($490 million) in the Xinjiang Uygur autonomous region to build a large manufacturing base where it will make cranes, excavators and bulldozers for the Central Asian markets.
"We will invest another $7.5 million in Central Asia to set up a country branch in Kazakhstan within the next year," said Lu. "The money will also be spent to add local dealerships, service and distribution stations and warehouses and to support spare parts sales."
XCMG has focused on selling excavators, bulldozers, road rollers and wheel loaders for construction markets in Central Asia for seven years.
XCMG sold $150 million of equipment to five Central Asian nations in 2012. More recently, the company won a contract in June to supply 42 sets of equipment for rail construction in Kyrgyzstan.
International players such as Caterpillar Inc of the United States and Komatsu Ltd of Japan have been consolidating their presence by diversifying their localization strategies and sewing up alliances throughout Central Asia.
Wang Zhibing, general manager of Sany Heavy Industry Co (Kazakhstan) Ltd, said the current Central Asian customers need durable products and powerful engines that can cope with multiple tasks and tough road conditions.
Sany is China's biggest, and the world's sixth-largest, maker of construction machinery. Last year, it opened its Xinjiang manufacturing facility, where it aims to produce 12 billion yuan of goods by 2016. It is targeting markets in Central Asian and Northwest China.
The company is also expanding its product line to include wind power and coal chemical equipment, because Central Asia is rich in both resources.
Its Kazakhstan branch also plays a key role in supplying construction machinery to another four markets in the region. It has six dealerships in Kazakhstan. Wang said the number is expected to double in 2014.
"After Astana became the capital of Kazakhstan in 1997, the expansion of urban areas hasn't finished. The country is planning to build more railway and underground lines," Wang said.
Khanatbek, director of the Central Asia business department of Zoomlion Heavy Industry Science and Technology Co Ltd's Xinjiang branch, said many affluent individuals and companies in the Central Asian region are also keen to buy construction machinery to become contractors or to lease the machinery out.
Zoomlion sold $6.53 million worth of truck cranes and $7 million of excavators in Central Asia in 2012.
It will set up a sales company in Astana next year and a service and distribution center in Khorgas, a Xinjiang town near the border with Kazakhstan, to move closer to its customers in Central Asia.
