Operational Analysis of the High-end Equipment Manufacturing Industry

I. Overall Industry Operation

In the first quarter of 2025, China's high-end equipment manufacturing industry showed a sound operational momentum as a whole, with positive performance in terms of industrial scale, technological innovation, and market demand.

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R&D investment has been continuously increased, and breakthroughs in key technologies have been achieved in multiple fields. In the integrated circuit sector, the application proportion of "Made-in-China Chips" has been constantly rising; in "chokepoint" fields such as aero-engines and deep-sea and deep-space equipment, the pace of technological iteration has accelerated. The upgrading of intelligent manufacturing has yielded remarkable results, with a total of 421 national-level intelligent manufacturing demonstration factories cultivated across the country. CRCC Heavy Industry, part of the Changsha construction machinery industrial cluster, successfully developed the main bearing for super-large diameter tunnel boring machines (TBMs), completing the "final link" in the independent industrial chain of TBMs.

The construction of high-end industrial clusters has shown a strong momentum. Hunan Province has formed a powerful synergy at the provincial, municipal, and county levels to promote the development of industrial clusters. Five industrial clusters, including Changsha's construction machinery cluster, have become national advanced manufacturing clusters, ranking among the top in China in terms of quantity. Since the Hengyang-Changsha-Zhuzhou-Xiangtan UHV power transmission and transformation equipment industrial cluster was selected into the "national team", its development has accelerated, and a number of products within the cluster have led the global or national market in terms of market share.

(1) Impact of Macroeconomic Operation on the Industry

In the first quarter of 2025, the domestic macroeconomic environment for the high-end equipment manufacturing industry was characterized by the in-depth integration of policy support and market recovery. At the national level, a series of policies for large-scale equipment renewal have been continuously rolled out. Through special subsidies and tax incentives, technological upgrading in the fields of special-purpose equipment and general-purpose equipment has been directly stimulated. Combined with the rigid demand for high-end equipment driven by the construction of "new infrastructure, new urbanization, and major national projects", the proportion of profits of the equipment manufacturing industry in the total profits of industrial enterprises above designated size has increased by 1.4 percentage points year-on-year to 32.0%.

(2) Industrial Policies and Industry Development

In the first quarter of 2025, the People's Bank of China implemented a moderately loose monetary policy and strengthened counter-cyclical adjustments. By comprehensively using tools such as deposit reserve ratio, open market operations, medium-term lending facility, and re-lending and re-discounting, it maintained sufficient liquidity, guided financial institutions to fully meet the effective credit needs of the real economy, promoted a decline in comprehensive social financing costs, optimized the adjustment of credit structure, kept the exchange rate basically stable, and steadily resolved financial risks in key areas. During this quarter, the counter-cyclical adjustment effect of the monetary policy was obvious: the total financial volume grew steadily, the comprehensive social financing cost was at a historical low, the credit structure was continuously optimized, and the RMB exchange rate remained basically stable.

For the equipment manufacturing industry, such a monetary policy has brought many positive impacts. Sufficient liquidity makes it easier for equipment manufacturing enterprises to obtain bank loans, meeting their capital needs in technological R&D, equipment renewal, and capacity expansion. The decline in comprehensive social financing costs directly reduces the financing costs of enterprises, increases their profit margins, and enhances their competitiveness in the market. The optimization of credit structure adjustment enables equipment manufacturing enterprises, especially specialized, refined, distinctive, and innovative small and medium-sized enterprises, to obtain more financial support, which helps promote technological innovation and industrial upgrading of enterprises and accelerate breakthroughs and development in the field of high-end equipment manufacturing. Overall, the monetary policy environment was favorable for the operation of the high-end equipment manufacturing industry.

II.  Industry Development Trends

(1)  Accumulation of Technological Innovation for Breakthroughs

Under the guidance of the national innovation-driven development strategy, the high-end equipment manufacturing industry will continue to increase R&D investment and focus on tackling key "chokepoint" technologies. In the integrated circuit field, enterprises will accelerate the improvement of chip manufacturing processes, promote the application of "Made-in-China Chips" in more high-end equipment, and gradually increase the proportion of independent and controllable technologies. In core fields such as aero-engines and deep-sea and deep-space equipment, R&D resources will be further concentrated to accelerate technological iteration. For example, in the manufacturing technology of hot-end components of aero-engines, through the application of new materials and the R&D of advanced manufacturing processes, it is expected to improve the performance and reliability of engines. The upgrading process of intelligent manufacturing will also be accelerated, and the level of independence of key equipment such as CNC machine tools and industrial robots will be significantly improved. Taking Sany Heavy Energy Shaoshan Blade Factory as an example, it has realized the full-process automated management of blade production by virtue of technologies such as fully intelligent auxiliary positioning and robot laser guidance. In the future, such intelligent production models will be more widely promoted and applied in the industry.

(2) Gradual Expansion of the Market Pattern

In the domestic market, with the continuous advancement of the policies on "new infrastructure, new urbanization" and "major national projects", large-scale equipment renewal and the trade-in program for consumer goods will release huge demand. The equipment renewal policy in the industrial sector encourages enterprises to phase out old equipment and purchase advanced high-end equipment, thereby improving production efficiency and product quality, which will directly drive the growth of market demand for the high-end equipment manufacturing industry. In the international market, the international competitiveness of China's high-end equipment manufacturing enterprises will be continuously enhanced. In advantageous fields such as rail transit and new energy equipment, domestic equipment will accelerate its "going global" pace and expand its global market share. For example, relying on advanced technology and reliable performance, China's high-speed rail has already launched projects in many countries and will continue to expand its presence in the international market in the future. At the same time, international supply chain cooperation in high-end equipment will be further deepened. Chinese enterprises will play a more important role in the global industrial chain. Through cooperation with international enterprises, they will further improve their technological level and management capabilities, and gain a more favorable position in international competition.