70% of Czech Machine Tools Export Overseas Plans to Deepen the Chinese Market

The Czech Engineering Technology Association (SST), a member of the European Machine Tool Industry Cooperation Council (CECIMO), held a press conference entitled "New Trends in the Machine Tool Industry in the Czech Republic".

“China’s global influence not only comes from its political status, but it is mainly due to its increasing economic strength. The Czech machine tool companies with medium-term goals should not only consider how to export products to China, but should focus on reducing production and transportation. In terms of cost and other aspects, cooperation in production is being carried out in China.” This is the collective voice of Czech company exhibitors ALTA Group, CKDBLANSKO, PRAMET, KOVOSVITMAS, TOS and other company representatives at the press conference – from a single import and export trade to deep plowing in China. The market's leaps and bounds.

About 70% of the Czech machine tools exports more than 70% of Czech's mechanical industrial products to foreign countries. Their products are widely recognized in the market for their good reputation and popularity. Machine tool production accounts for a large proportion of the Czech economy, and processing machines and forming machines have had more than 150 years of production history in the Czech Republic. Czech machine tool manufacturers not only provide modern technology products, production lines and complete industrial projects, but also modernize the factory.

The world's machine tool output showed a continuous upward trend from 2003 to 2008. Due to the impact of the economic crisis, the global machine tool output experienced a serious decline after reaching the highest level in history in 2008.

The growth trend of the Czech machine tool equipment production is generally consistent with the world trend. The period of 2003-2008 is the high-speed development period of its machine tool industry. During this period, the production of machine tools in the Czech Republic increased by 2.5 times. The rapid growth in recent years was driven by investment in Slovakia and Europe. Because Czech Republic's machine tools account for about 70% of exports, the global financial crisis has depressed the European economy and the machine tool market has shrunk, so the Czech machine tool industry has suffered a great loss. However, the sharp decline in machine tool output eased in 2010. It is expected that the Czech machine tool industry will gradually recover in 2012 and both machine tool output and exports will increase.

In 2010, Czech metal cutting and metal forming machine tool imports mainly came from Germany, South Korea, Italy, Japan, and Switzerland were the second-tier countries in the Czech Republic. The advantage of the machine tool industry giants from Western European countries lies in their own distribution channels. In addition, the same trade in Europe has created geographical trade advantages. In contrast, Asian machine tool manufacturers that lack geographical advantage rely on favorable financing conditions and also form fierce competition in the Czech machine tool market, highlighting Japan as the representative.

As the Czech machine tool market mainly focuses on high-end models, there are fewer imports of low-end products from mainland China. In addition, the computer industry’s investment in the Czech Republic in recent years has also led to some imports. For example, machine tools manufacturers in Taiwan have used electronic technology companies to enter the Czech Republic to set up factories and adopted the strategy of entering high-end models into the Czech market, making the Czech Republic’s machine tools from Taiwan and China. Imports are roughly equivalent.

In Europe, Germany is the largest exporter of machine tools, and the Czech Republic is ranked seventh. In the world, the country with the most machine tool exports is still Germany, and the Czech Republic ranks 12th. The production of metal cutting and metal forming machines is an important sector of the Czech machinery industry and has become the backbone of the Czech machinery industry.

Before joining the European Union, all countries in the world have been optimistic about Czech’s low wages, human resources and geographical location. In recent years, as a large number of foreign capital has entered the Czech machinery manufacturing industry through direct or indirect investment, the technological level of the Czech machinery manufacturing enterprises has continuously improved. The advantage of Czech machine tool equipment is that it not only has European quality assurance, but also has lower prices than Western European countries.

The main export markets of machine tools and equipment produced in the Czech Republic are the countries of the European Union, Russia, and the United States, which have very high requirements on the performance of imported equipment. The country with the highest share of Czech machine tools exports is Germany, which proves that the Czech machine tools have good performance. Technical level and reliability. Moreover, the Czech machine exports to these major markets have been growing year after year, further demonstrating that the quality of their machine tools has stood the test.

Trade with China's machine tools will be more diversified 2013 was the 60th anniversary of Czech machine tool equipment exports to China. The first Czech machine tool exported to China arrived in Shanghai in 1953. Since 2008, the number of machine tools exported by the Czech Republic to China has grown rapidly. According to data from 2010, China has become the third largest exporter of Czech metal cutting and metal forming machine tools, second only to Germany and Russia. The country with the largest share of Czech machine tools exports was Germany, which accounted for 27.33%, followed by Russia, accounting for 13.46%, and China ranked third, accounting for 10.91%.

BedrichMusil gave an example at the press conference about the use of Czech machine tools in various parts of China. In addition to the northern provinces where heavy industry is more developed, other provinces also use Czech machine tools. In the northeastern region, hydro turbine equipment in the Czech Republic has been put into use in Fulaji District of Heilongjiang Province and Shenyang, Liaoning Province. In Central China, Alstom, a Sino-French joint venture hydroelectric equipment manufacturer based in Tianjin, uses Czech turbines, and Shaanxi Xi’an Aircraft Engine Manufacturing Plant and Wuhan Heavy-duty Casting and Forging Plant all have Czech machine tool equipment. In the western and southern regions of China, the heavy-duty machine tool bed produced by Czech CKDBLANSKO, which is used by Sichuan Deyang Erzhong Machine Tool Plant, is one of the company’s largest equipment. In Sihui, Guangdong, some local companies also use Czech production equipment.

In the 1990s, when European companies began to exploit the Chinese market, Czech companies focused their attention on Western Europe due to human and financial constraints. So far, Czech machine tool companies have not entered the Chinese market on a large scale. The reason for this is first of all the fear of a fierce competitive environment in the Chinese market. Similar products from many countries pose a great threat to Czech companies; the second is geographically distant, and at the same time to the Chinese market. The lack of understanding of the features. Entering the Chinese market is difficult for Czech SMEs. Under normal circumstances, companies with strong capital have more opportunities in China.

The main method of Czech participation in the Chinese market competition is to join multinational companies that have entered China. SKODA, TOS Varnsdorf, AVIA and other companies have established wholly-owned or joint ventures in China. The Czech Ministry of Industry and Trade has also participated in the CIMT2011 with the aim of sharing more business information, such as unique economic and trade cooperation investment opportunities.

Exploring the Chinese market is a long-term task. It requires a full understanding of the local market, adequate financial support, and a wide network of business relationships. In the future, the Czech government will continue to provide financial support for the establishment of representative offices of Czech machine tool companies in China, and organizes Czech machine tool manufacturers to participate in various exhibitions, expos and seminars held in China, and to organize government delegations of both countries and accompanying businesses. Visits by family delegations. At the same time, the Czech machine tool manufacturers will gradually increase their share of the Chinese market by improving their economic commerce institutions in China and strengthening investigation and research on the Chinese market.