China's equipment manufacturing industry is currently facing challenges

Abstract What is the footsteps of the transformation and upgrading of the equipment manufacturing industry? How to get out of the "first value of production but the profit is outside" cycle? The challenges facing China's equipment manufacturing industry are fundamental and difficult. 80% of the largest manufacturing country in the manufacturing industry, high-end chips and power generation equipment, high-quality large castings and forgings,...
What is the footsteps of the transformation and upgrading of the equipment manufacturing industry? How to get out of the "first value of production but the profit is outside" cycle? The challenges facing China's equipment manufacturing industry are fundamental and difficult.

The biggest country in the manufacturing industry

80% of high-end chips and power generation equipment, high-quality large castings and forgings, 90% high-speed CNC machine tools and robots, and nearly 100% of high-speed rail bearings, rely on foreign imports

"The dragons are all diving into the sea, and they all go to the moon. But such a powerful Chinese equipment manufacturing industry can't make a piece of equipment for producing stockings. How ironic!" Marketing Director of Changzhou Runyuan Warp Knitting Machinery Co., Ltd. Liang, who worked for Karl Mayer, the world's largest warp knitting machine manufacturer, for more than 10 years, and the realization of high-end equipment localization made him and the current boss hit it off.

In Xu Liang's view, the humble stocking machine is the epitome of China's equipment manufacturing industry. The stocking machine is a kind of warp knitting machine. Although as of last year, China's warp knitting machinery has accounted for 85% of the global total, and the average export price has increased by 50.7%, but the average import price is 3.93 times the average export price. And many high-speed, intelligent warp knitting machines are still not manufactured in China.

"The speed of the stocking machine is as high as 4,000 rpm. Such high speed requires extremely high steel strength and manufacturing precision. If the difference is small, it will cause the machine to be scrapped. The basic materials and basic manufacturing process are precisely the weakness of China's equipment manufacturing industry. Our steel, heat treatment process, etc. are all in a few grades." Xu Liang said.

Basic components, basic processes and basic materials (referred to as “three basics”) are the basis for the survival and development of manufacturing industries, and their level directly determines the performance, quality and reliability of major equipment.

"China's large-scale complete sets of manufacturing equipment basically meet the needs of national economic construction, but there are deep contradictions in core technology subject to people; especially the rapid development of high-end equipment and the shortage of supporting 'three-based' products have become a constraint industry. The bottleneck of development is the biggest shortcoming of the manufacturing industry from large to strong," said Wang Jun, president of the China Academy of Cars.

The development of “three basics” lags behind, and the self-sufficiency rate of high-end materials and parts is not high. The growth of manufacturing industry is over-reliant on the growth of processing and manufacturing and single-machine manufacturing, and a large amount of profits are outflowing. The data shows that China's manufacturing technology dependence on foreign technology exceeds 50%, 80% of high-end chips, 80% of high-quality large-scale castings and forgings, 90% of high-end CNC machine tools and robots, nearly 100% of high-speed rail bearings, rely on Imported from abroad.

"The high-end components and high-end materials required for major equipment and mainframe products are imported, resulting in the mainframe and complete sets of equipment falling into the 'empty shell' dilemma. Like the high-pressure pumps, valves and motors of 30 MPa or more for construction machinery, almost all imported, 70% of the profits of the industry have been swallowed up by imported parts,” said Qu Xianming, the former vice president of the Institute of Mechanical Science and the representative of the overall group of the China Academy of Engineering.

The lagging development of “three basics” also leads to low utilization of industrial resources, resulting in problems of poor quality, reliability and longevity of domestic equipment. Taking high-end structural materials as an example, China still has 25% of materials and parts dependent on imports; 45% of materials are “capable of exhibits, but cannot make products”, and mass production cannot be achieved. "China's manufacturing single-machine energy consumption is eight times the average level of developed countries, and the economic loss caused by product quality problems in a year has reached more than 200 billion yuan." Gan Yong said.

What is more alarming is that the dependence of a large number of basic products on imports not only increases the cost of the whole machine, but also the embarrassing situation of being subject to people. The price of the key “three-based” products is getting higher and higher, and the delivery time is not guaranteed.

Where are you dragging your hind legs?

We are used to "reverse engineering", and the original transformation institutes that have undertaken common technology research and development are also busy with industrialization.

The development of the "three basics" products lags behind, in the end, where is the drag?

This is related to the traditional development model of China's "reverse engineering". “For a long time, we have all reversed innovation, that is, we first developed the whole machine to meet the demand for use, and then developed basic materials to solve the problem of localization. Such a research and development model led us to get out of the shortage economy at a faster rate, but the basic theory Insufficient research, insufficient accumulation of core common technologies, insufficient core process reserves, and hidden dangers for industrial transformation and upgrading." Qu Xianming said.

China's equipment manufacturing industry is on the track of "reverse engineering" and is affected by the objective historical environment. The industrialization of developed countries started from scratch, and the "three basics" had to do it all by themselves. China's industrialization is advancing in a globalized open environment. It has a wide division of expertise and does not need to do anything on its own. "But now we have to move from the low end of the industrial chain to high-end equipment. People either don't sell your core parts and materials, or they ask for the price, they get stuck in our neck." Qu Xianming said.

The influence of the "heavy host, light foundation" malformation of political achievements is not to be underestimated. "To engage in the mainframe, the political achievements are obvious, and a basic political performance does not seem conspicuous, and it takes at least four or five years to see results. During this period, the performance of the corporate leaders is not conspicuous. Under the current performance evaluation system, how can there be no promotion? Business leaders think that it is better to spend a lot of human and financial resources to expand production capacity, so where is the motivation for 'three basics'?" Qu Xianming said.

The “three basics” research and development also lacks the support of common technology and basic research. A sound innovation chain should be based on basic research, with common technology research as the link and theoretical development and application as the export. At present, basic research and common technology research in China are the most vulnerable shortcomings. A large number of research institutes that originally undertaken basic research and common technology research and development have paid more attention to effective application research and industrialization after being converted into enterprises.

"From the current situation, the national macro-industry common technology policy and development strategy are still unclear. The original conversion institutes that undertake common technology research and development are busy with the industrialization process. The relevant research bases and research platforms are in a state of dispersion or idleness. Fight." Gan Yong said.

The improvement of the basic technology of the equipment manufacturing industry is also inseparable from the high-quality industrial workers. According to Sun Xiaoyin, deputy director of the Personnel Department of the China National Textile and Apparel Council, a textile company imported a batch of German high-end machinery in one year, and wrote in the assembly manual, "Please turn the last screw button forward three times and then turn back. Half a circle before you can use." The Chinese workers were "smart" to install and debug two and a half times, and found that the machine could not be used until the instructions were made, and the problem was solved.

"Why are German and Japanese products reliable and favored? Because the quality of industrial workers is high, it not only ensures the manufacturing precision of the products, but also promotes the continuous improvement of the process. Therefore, it is imperative to improve the quality of front-line employees in the manufacturing industry." Sun Xiaoyin said.

Completing the short board from "big to strong"

The “three basics” industry has low investment intensity and is suitable for SMEs to intervene, but it also depends on national policy support.

To consolidate the foundation of equipment manufacturing, we must first change our thinking. The "three-base" industry is called the "midfield industry" and is the core and driving industry of the manufacturing industry in the future, just like a team is driven by midfield players. Its volume is smaller than the terminal equipment, but the profit is higher. Like a car, the overall profit margin is 5%, while the component profit is as high as 5.9%.

"Basic components, basic materials, basic processes and mainframes should be spiral-up R&D processes, just like building airplanes, no engines, no titanium alloy profiles, and nothing can be done." Wang Wenhu, general manager of CSR Qishuyan Locomotive Vehicle Technology Research Institute It is said that in the field of full competition in China, the more key components and basic high-end materials, the higher the profits, but the mainframe manufacturing is often hard earned. "This is the technical advantage of 'people without me,' 'people have me fine'."

The “three basics” industry has low investment intensity and is suitable for SMEs to intervene, and it is better to use traditional grafting and high-tech research and development models.

Since last year, the economic situation of the textile industry, especially the cotton spinning industry, has been sluggish, but Tonghe Textile Machinery Manufacturing Co., Ltd., which has just entered the spinning machine market this year, has won more than 75% of the market in Henan and Shandong, and its sales have doubled. .

"A company that makes money at the terminal must have the quality and service of its core components, so I can take the half-wall market with one shot." The key component of the textile machine started as a roller, and the textile machine is now the largest in the world. The Rolla production company began to enter the middle and high-end compact spinning equipment, roving frame, spinning machine and other complete machines. Chairman Cui Guisheng is the beneficiary of the “three basics” research and development. “With the core components and the whole machine, I have the foundation to meet the needs of the enterprise, and the competitive advantage is obvious.”

In order to make up for the shortcomings of the current innovation system, some large enterprises in China, especially large central enterprises, have begun to establish various forms of "central research institutes" to integrate existing research and development resources. In Qu Xianming's view, there are some successful examples of the Academia Sinica in foreign countries, but the current positioning of these institutes in China is not clear.

"The positioning of these Academia Sinica and existing research institutes should be clearly differentiated. It should not be researched on the current market demand, but should focus on the needs of five years or even longer, and do a good job of technical reserves. Otherwise, it will only increase the institutions. "There is no practical significance." Qu Xianming said, "Now China's economic growth is slowing down and it is in a medium-speed growth period. It is a good period for adjustment. Let everyone understand the importance of the 'three basics' and develop a unique product than to expand. Capacity is more important!"

Complementing the shortcomings of the "three basics" depends on national policy support. At the end of 2011, the state has issued the “Twelfth Five-Year Development Plan for Mechanical Basic Parts, Basic Manufacturing Process and Basic Materials Industry”, and proposed to study and formulate policies to encourage users to adopt “three basics” new products and new processes. However, there have been no relevant rules to come. In 2013, the “National Transformation and Upgrade Base Project” focused on 15 key directions including high-standard bearing steel materials for bearings, and subsidized support for demonstration project investment. The maximum amount of subsidies for a single project is not more than 30 million yuan. However, this subsidy is still a drop in the bucket for research and development.

What is exciting is that the "Decision" of the Third Plenary Session of the 18th CPC Central Committee has clearly stated that "integrate scientific and technological planning and resources, and improve the government's support mechanism for basic, strategic, cutting-edge scientific research and common technology research." Many entrepreneurs have called for, in addition to direct financial subsidies, relevant departments should provide preferential policies such as tax-free and interest-free loans for the “three-based” projects, and implement the spirit of the “Decision” as soon as possible, and clarify the relevant supporting rules.

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