Loaders squint to the east – Newspaper Kommersant No. 196 (7397) of 10/21/2022

Domestic manufacturers of road construction equipment (DST) increased sales by 30% over nine months, to 48 billion rubles. At the same time, Rosspetsmash is dissatisfied with dumping by Chinese companies, offering to raise the scrap fee to protect the market. Other market representatives note that such a measure creates risks for Russian players, although they recognize growing competition from China.

According to the results of nine months, sales of domestic DST in the Russian market grew by 30% in monetary terms, reaching 48.2 billion rubles, Rosspetsmash calculated. The pace of shipments in July-September increased slightly compared to the first half of the year, when sales grew by 28%. The dynamics of output turned out to be about the same: growth by 38% (53.3 billion rubles) against an increase in production by 35% in January-June.

Dmitry Babansky from SBS Consulting notes that the growth in sales in value terms is primarily a consequence of rising prices for materials and components, as well as an increase in the cost of borrowing.

In the second half of the year, the market stabilized somewhat, Kommersant was told at UMG SDM (an asset of the United Machine-Building Group), but over the eight months its dynamics still remained negative (minus 2%). In addition, the market for road construction equipment added 25% in August. According to their expectations, the market will recover by the end of the year, but this will not affect all segments:

“The backhoe loader and telehandler markets, dominated by European and American manufacturers, have sagged significantly and will not recover anytime soon.”

The segment of backhoe loaders, according to Rosspetsmash, decreased in January-September by 52% against 47% in the first half of the year. UMG SDM says that their sales have fallen due to problems with the supply of components.

Sales of truck cranes also went into the red — by 4%. However, the rest of the shrinking segments, on the contrary, straightened out a bit: for example, sales of rollers fell by 28% over the first nine months (against 34% in six months), pipe-laying cranes – by 17% (previously 34%). Front-end loaders grew by 50% vs. 34% in half a year, excavators — by 59% (vs. 31%), skid steers — by 20% (vs. 15%), motor graders — by 11% (vs. 4%) and loader cranes — by 9% (6%). Also, shipments of telescopic loaders are growing by 2.2 times.

Rosspetsmash notes that foreign companies are not faced with the need to replace components and “therefore, they have received the main competitive advantage.”

“Manufacturers from a number of countries resort to dumping, negatively affecting the development of Russian engineering,” the association says, proposing “to protect the domestic market from imports by introducing anti-dumping measures and raising salvage rates.” Dumping by foreign suppliers, including Chinese, was discussed in the association even before the crisis, in the summer of 2021. Kommersant’s interlocutors in the industry then noted that the scale of production of special equipment in China is ten times higher than in the Russian Federation, which ensures low cost.

According to Dmitry Babansky, the strengthening of the ruble had a negative impact on the attractiveness of Russian technology compared to Chinese. “Our manufacturers also had to look for alternative suppliers and build new logistics, which also had a negative impact on competitiveness,” he concludes, noting the high support for exports from China.

A representative of the Spetsavtoprom association emphasizes that the increase in salvage fees still hits all consumers, as Russian manufacturers face delays in salvage fee compensation from late summer to February every year.

As a result, some are forced to take loans to pay for the disposal fee. At the same time, in September, government decree 2796 was issued, according to which a credit line for 120 billion rubles is approved. with a subsidized rate “Avtodor-Leasing” “for the purchase of priority imported products” with a wide list of DST. According to him, most of the equipment from the list is produced in the Russian Federation: “Significant problems are only for asphalt pavers and concrete pavers – there is no capacity to cover demand. But most of the nomenclature is hard to explain.”

Now, the representative of the Spetsavtoprom association notes, European equipment is delivered piece by piece according to complex schemes like “temporary import from Kazakhstan”. Chinese deliveries are not actively growing due to the high load on logistics corridors: “It takes three to four months for equipment to be shipped at customs in China, that is, as a result, it takes about six months, while Russian equipment takes from 30 days.”

Olga Nikitina