All electric machinery, as long as it can move, is inseparable from the motor. The quality of motor not only determines the success of toy contest for children, but also the contest of industrial level. In the future industrial process, motor is still a basic and core component. However, in today's motor market, many manufacturers are not calm, even a little anxious. Some domestic motor manufacturers said that the current competition in the motor industry is too fierce and disorderly, and profit margin has been compressed all the way close to the pole.
Why, on earth, are industrial components with certain technological content sold on the market at prices such as scrap iron? After visiting many domestic motor manufacturers, it was found that the turbulence of the motor market was caused by both external market factors and internal industry factors. To blame, it is the result of the "two wars", namely the trade war and the price war.
Less cake, more people eat cake
In recent years, the rise of AI and Internet of Things technology has brought about the upsurge of transformation and upgrading of manufacturing industry. Industrial robots, new energy vehicles, unmanned aerial vehicles and other industries have developed rapidly. Because of the importance and rigidity of motor in the industrial field, more and more people enter the motor industry.
However, in the second half of 2018, China's manufacturing industry turned downward sharply, and the market share of the associated motor industry gradually decreased. We can blame trade wars in part for this situation, but it is essentially the result of the global economic recession.
Throughout the world, only China, India and Vietnam had GDP growth of more than 5% in 2018, while the United States had only 2.86%. Germany's GDP growth rate in the first quarter of 2019 was only 0.7% and is expected to be only 0.5% for the whole year. Turkey, which is between Asia and Europe, may have only 0.6% this year (forecast by the Turkish Central Bank) and Singapore, which is only 0.1%. In view of the global economic downturn, the overseas market of motor manufacturers has been greatly reduced, and the corresponding domestic market also has a chain reaction.
From the specific market performance, first of all, the textile industry is experiencing the worst year in ten years. Textile industry is an area with large amount of servo products, which has a great impact on the manufacturers of servo motors. Secondly, under the background of trade war, orders of domestic manufacturing industry have decreased, and the demand for automation equipment has shrunk accordingly.
When I visited many electrical machinery manufacturers, I found that small and medium-sized electrical machinery factories can basically achieve about 20% growth because of their small size and stable overall business. However, compared with the past few years, the growth rate is still declining sharply. The real decline is serious, mainly concentrated in large-scale motor manufacturers, first Jiangte, Dayang, Fangzheng, these large-scale manufacturers, because of the large market volume and the global economic downturn, business growth declined seriously; secondly, large-scale manufacturers of general motors, facing many new entry competition. On the contrary, most of the small and medium-sized manufacturers tend to customize their products, and their customer groups are relatively stable.
Price Fight, Electric Machine Becomes Chinese Cabbage
Regardless of any industry, the price war makes customers profitable in a short time, and also makes the underfunded businessmen feel disgusted. Perhaps the most profound experience of the price war is the fight with Uber a few years ago, but the good thing of "one yuan" taxi will not exist in a few months.
As mentioned above, there are fewer "cakes" and more people eating cakes in the motor industry. Some motor manufacturers, out of the need of strategic layout, use low-cost strategies to attract customer resources. In the market, a servo motor, originally 1000 yuan, can now be reduced to 800 yuan for brushless motor control scheme of electric tools, sold to 6, 7 yuan, or even 4, 5 yuan, is really less than a pack of cigarettes.
In this motor price war, some manufacturers are involved passively. These involved businessmen also revealed great helplessness. A person in charge of Dongguan Electric Machinery Manufacturer said: "Without participating in price war, sales will not come up, but a dozen, and found that the funds are not very sufficient, and there is no experience in price war. In addition, enterprises have no profits, how can they do a good job of products?
Despite the motor market, there are still some servo motor manufacturers, who are not moved by the price struggle, insist on choosing high-quality customers, and follow the customized line of subdividing the market.
Rare Earth Raw Materials Rise, Profits Further Shrink
If the global economic downturn is a natural disaster, trade wars and price wars are man-made disasters, and rare earth raw materials are rising, it is really bad luck. Ten years ago, there was illegal exploitation of rare earths, and the market price went down all the way. Things have changed over time. Nowadays, it is impossible to buy rare earths of "pork price".
Entering 2019, the trade friction between China and the United States has escalated again, and rare earth has become our counterweight against the United States. With the adjustment of rare earth policy, the material cost of motor manufacturers has increased. In particular, most permanent magnet motor manufacturers are small in scale and lack of material reserve due to lack of financial strength. They are at a loss in the face of rising rare earth prices.
Industry sources revealed that this year's raw materials for electrical machinery, mainly affected by rare earth prices. Rare earth policy began to adjust in March and has multiplied several times in less than a month. Although the price of rare earth has been revised back at this stage, it is still more expensive than before. As a motor manufacturer, if rare earth stocks are small, it will still face enormous price pressures at this stage. It is worth mentioning that the era of low-cost motor manufacturing has become the past.
Since this year, many motor manufacturers have announced to increase the price of motor due to the rise in raw materials. However, some manufacturers have decided to solve the problem by internal digestion and try not to transfer the cost to customers. These enterprises may have sufficient rare earth reserves, and may have strong confidence in the control of raw material management.
Some insiders pointed out that there are wolves and tigers in the motor industry at present. The shrinking market and the rising raw materials are both attacking, which is quite disadvantageous to the survival of businessmen. However, the price fluctuation of rare earth is short-term, which may be a bargaining chip for the country's foreign trade negotiations. While the government does not sell rare earth cheaply, it will also take more care of the actual domestic industrial demand.