2024 China machinery industry overview of the economic operation

On February 14, 2025, the China Machinery Industry Federation held a press conference on the economic operation of the machinery industry in 2024 in Beijing. Luo Junjie, executive vice president of the China Machinery Industry Federation, released the economic operation of the machinery industry in 2024. The information release is now published as follows for your reference.

The industry is operating steadily and making progress, and the transformation and upgrading have achieved remarkable results

——Summary of the economic operation of the machinery industry in 2024

In 2024, under the strong leadership of the CPC Central Committee with Comrade Xi Jinping as the core, the machinery industry conscientiously implemented the decisions and arrangements of the CPC Central Committee and the State Council, adhered to the principle of seeking progress while maintaining stability, promoted stability through progress, faced challenges head-on, took positive actions, effectively responded to risks and challenges, and developed and expanded new quality productivity; driven by the "two new" and other policy measures, the industry operated generally smoothly, and high-quality development was steadily promoted. Looking forward to 2025, opportunities and challenges coexist, favorable conditions are stronger than unfavorable factors, and the economic operation of the machinery industry is expected to continue to maintain a stable and progressive development trend.

1. Basic characteristics of industry operation in 2024

In 2024, the economic operation of the machinery industry started well in the first quarter, was generally stable in the second quarter, and the growth rate of major indicators slowed down in the third quarter, showing downward pressure; in the fourth quarter, with the implementation of the "two new" policies and a package of incremental policy measures, the industry's operating situation stabilized and rebounded.

(I) Industry scale hits a new high

According to data from the National Bureau of Statistics, by the end of 2024, the number of enterprises above designated size in the machinery industry was 132,000, an increase of 11,000 over the previous year, accounting for 25.8% of the national industry, an increase of 0.8 percentage points over the previous year; total assets reached 39.4 trillion yuan, an increase of 5.2% year-on-year, accounting for 22.1% of the national industry, an increase of 0.6 percentage points over the previous year.

(II) Added value achieved steady growth

In 2024, the added value of machinery industry above designated size increased by 6.0% year-on-year, 0.2 percentage points higher than the national industry. The added value of the five major categories of national economic industries involved in the machinery industry all achieved growth, among which the automobile manufacturing industry played a leading role, with a growth rate of 9.1%; the growth rates of electrical machinery and instrument manufacturing industries were stable, at 5.1% and 6.0% respectively; the growth rates of general equipment and special equipment manufacturing industries were slightly lower, at 3.6% and 2.8% respectively.

(III) The production and sales situation was stable and improving

In 2024, the overall production and sales situation of the machinery industry was better than the previous year. Among the 122 major mechanical products under key monitoring, the output of 72 products increased year-on-year, accounting for 59%; the output of 50 products decreased year-on-year, accounting for 41%. The main characteristics of the production and sales of key products are as follows: First, the production and sales of automobiles hit a record high. The annual production and sales of automobiles reached 31.282 million and 31.436 million respectively, ranking first in the world for 16 consecutive years, an increase of 3.7% and 4.5% year-on-year respectively; among them, the passenger car market performed well, the commercial vehicle market was relatively weak, and new energy vehicles continued to maintain rapid growth. Second, the production of electrical and electrical products was stable and improved. The annual output of generator sets was 280 million kilowatts, a year-on-year increase of 16.0%; the output of solar cells was 680 million kilowatts, a year-on-year increase of 15.7%. Third, the stabilization of the manufacturing industry has driven the stable growth of processing equipment. The annual output of metal cutting machine tools was 695,000 units, a year-on-year increase of 10.5%; the output of metal forming machine tools was 160,000 units, a year-on-year increase of 7.4%. Fourth, the construction machinery industry ended its three-year downward trend and achieved a bottoming out and recovery. The sales of 12 key products increased by 4.5% in total, of which half of the products increased in sales, and the sales of excavators increased by 3.1%. Fifth, general equipment and basic parts products showed a growth trend, and the output of pumps, fans, compressors, bearings, fasteners, hydraulic components, metal seals and other products all increased. Sixth, the recovery of the consumer market led to an increase in the output of products such as cameras, service robots, and packaging equipment. Seventh, agricultural machinery was generally sluggish, and the output of 7 of the 10 key products decreased year-on-year.

(IV) Weak prices and declining benefits

In 2024, affected by multiple factors such as insufficient effective demand, continuous price declines, and a high base in the previous year, the efficiency indicators of the machinery industry were under great pressure. The annual operating income of the machinery industry above designated size was 31.5 trillion yuan, exceeding 30 trillion yuan for the first time, an increase of 1.7% year-on-year, and the growth rate was 0.4 percentage points lower than that of the national industry; the total profit was 1.6 trillion yuan, a year-on-year decrease of 8.0%, and a decrease of 4.7 percentage points deeper than that of the national industry. The operating income profit margin was 5.2%, down 0.5 percentage points from the same period last year, and 0.2 percentage points lower than the national industry in the same period.

(V) Investment growth rate fell and stabilized

In 2024, the growth rate of fixed asset investment in the machinery industry generally slowed down. The growth rate was 12.5% in the first quarter, 9.3% in the first half of the year, and 5.3% in the first three quarters. It fell to a low of 3.9% in October and then stabilized and rebounded. The annual growth rate was 5.1%, 1.9 percentage points higher than the growth rate of social investment, but lower than the national industry (12.1%) and manufacturing (9.2%) investment growth rates. The fixed asset investment performance of the five major national economic industries involved in the machinery industry was differentiated. General equipment, special equipment, and automobile manufacturing industries increased by 15.5%, 11.6%, and 7.5% respectively, while electrical machinery and instrument manufacturing industries decreased by 3.9% and 0.2% respectively.

(VI) Foreign trade is stable and progressing

In 2024, the machinery industry withstood multiple pressures, and the total import and export volume of goods trade, export volume, and trade surplus all hit new historical highs. According to the statistics of the customs, the total import and export volume of the machinery industry in 2024 exceeded one trillion US dollars for the fourth consecutive year, reaching 1.17 trillion US dollars, an increase of 7.5% year-on-year, accounting for 19% of the national trade in goods. Among them, the import volume was 299.68 billion US dollars, a year-on-year decrease of 1.6%, accounting for 11.6% of the national trade in goods; the export volume was 869.36 billion US dollars, an increase of 11% year-on-year, accounting for 24.3% of the national trade in goods. The trade surplus was 569.69 billion US dollars, an increase of 16.6% year-on-year, accounting for 57.4% of the national trade in goods.

(VII) Overall economic prosperity

The machinery industry prosperity index covers multiple dimensions such as production, industry, investment, foreign trade, economic benefits, and prices, and comprehensively reflects the economic operation of the machinery industry. In 2024, the machinery industry prosperity index showed a trend of high at the beginning and stable at the end. The index was high at the beginning of the year, fell month by month in the first half of the year, fell slightly again in the third quarter, and rebounded in the fourth quarter. The prosperity index was 103.1 at the end of the year. Except for the higher level at the beginning of the year, the prosperity index of each month has been running in the range of 102-104, which is generally lower than the level in 2023, but still in the prosperity range. Among the six secondary indexes, four are high and two are low. The product index, industry index, investment index, and foreign trade index are higher than the critical value, at 103.6, 105.8, 108.4, and 106.0 respectively; the economic efficiency index and price index are lower than the critical value, at 94.1 and 97.8 respectively.

2. Highlights in the development of the industry

In 2024, the machinery industry will adhere to scientific and technological innovation and green development, accelerate the cultivation of new momentum and new advantages, actively promote high-end, intelligent, green and integrated development, and the industry will have many highlights in high-quality development and transformation and upgrading.

(I) Scientific and technological innovation promotes the improvement of industrial foundation

First, the innovation capacity will be steadily improved. In 2024, 33 new industry innovation platforms will be approved for construction, and a total of 290 industry innovation platforms will be listed and approved for construction. More than 400 technical equipment appraisals have been completed, and 430 industry science and technology awards have been awarded. Second, quality standards are constantly enhanced. The machinery industry focuses on the battle of "advanced industrial foundation and modernization of industrial chain", and continues to accelerate the construction of a quality standard system to promote high-quality development of the industry. In 2024, 4 new industry quality inspection agencies will be added, with a total of 257, more than 200 laboratory reviews of various types will be completed, 1,227 industry standards will be formulated and revised, and 313 standard internationalization projects will be promoted. Third, the resilience and security level of the industrial chain and supply chain will continue to improve. The machinery industry focuses on the key links and weaknesses of the industrial chain and supply chain, accelerates the independent research and development of key core technologies and equipment, and strives to improve the resilience and safety level of the industrial chain and supply chain. Independent research and development results in basic fields continue to emerge. For example, the world's first 25 MW wind turbine main shaft bearing and gearbox bearing, the world's largest pile driving ship main cylinder, etc. were successfully rolled off the production line, the world's first 500 MW impact hydropower unit water distribution ring pipe, ball valve castings were completed and delivered, and the development and industrialization of high-performance fasteners for high-speed rail and nuclear power equipment filled the domestic gap. Continuously variable speed and power shifting technology and products have made breakthroughs and industrialized applications. The nuclear power plant emergency diesel generator set "Nuclear Diesel No. 1" with independent intellectual property rights was officially released, and nuclear-grade pneumatic check valves and large-capacity generator circuit breakers for nuclear power units above one million kilowatts were successfully developed. The key core materials and equipment such as the FB2 medium-pressure rotor material of the ultra-supercritical unit and the proton exchange membrane for hydrogen production by electrolysis of water have been localized, and the 1000 kW civil turboshaft engine has obtained a type certificate, etc.

(II) Significant achievements in green and low-carbon transformation

First, new energy vehicles continue to advance rapidly. In 2024, the production and sales of new energy vehicles will exceed 12 million, reaching 12.888 million and 12.866 million respectively, ranking first in the world for 10 consecutive years, with year-on-year growth of 34.4% and 35.5% respectively. The sales of new energy vehicles accounted for 40.9% of the total sales of new vehicles, an increase of 9.3 percentage points over the previous year. Second, the rapid development of clean energy equipment will promote my country's green and low-carbon transformation of energy and the construction of a new energy system. In 2024, the output of wind turbines accounted for more than half of the output of generator sets; in 2024, the national renewable energy power generation installed capacity will increase by 370 million kilowatts, a year-on-year increase of 23%, accounting for 86% of the new installed capacity of electricity, of which wind power will increase by 80 million kilowatts and solar power generation will increase by 280 million kilowatts. Third, the pace of green transformation of traditional industries will accelerate, and advanced green and intelligent products will continue to be developed and applied. In agricultural machinery, the application of new energy tractors, intelligent tractors, highly automated combine harvesters and other products has significantly accelerated, and intelligent equipment such as unmanned agricultural machinery, unmanned plant protection machines, unmanned rice transplanters, and unmanned combine harvesters have continued to emerge; in engineering machinery, the trend of electrification substitution of products such as loaders, mixer trucks, mining trucks, and aerial work platforms is strong. For example, the sales volume of electric loaders will increase by 2.1 times in 2024, and the penetration rate will reach 10.4%. The penetration rate in some regions exceeds 60%.

(III) Digital transformation and intelligent reform stimulate new momentum for the industry

First, smart factories are emerging. In 2024, more than 80 machinery companies were selected into the first batch of excellent smart factory projects in my country; 6 machinery companies' smart factories were selected into the global "lighthouse" factories, and the total number of selected machinery industries reached 24, accounting for 30% of the total number of "lighthouse" factories in my country; the penetration rate of digital R&D and design tools of enterprises above designated size exceeded 80%, and the average development cycle of demonstration factories was shortened by nearly 30%. Second, intelligent manufacturing equipment is developing rapidly. In 2024, the output of industrial robots will increase by 14.2% year-on-year to 556,000 sets, setting a new record. Third, intelligent connected vehicles are booming. The application of new technologies such as artificial intelligence, big data, and 5G communications has accelerated the development of intelligent vehicles. Technological innovation and application scenarios are constantly enriched. Technologies such as intelligent assisted driving, human-computer interaction technology, and smart lighting systems are rapidly advancing and popularizing from high-end cars to mass vehicles. The penetration rate of L2 assisted driving passenger cars has increased significantly.

(IV) Major technical equipment has made new breakthroughs

The machinery industry has actively promoted collaborative innovation and carried out joint research, and a number of major technical equipment have achieved new breakthroughs. The independently developed 300 MW F-class heavy-duty gas turbine has made milestone progress. The prototype has been assembled, ignited, and tested at full load, breaking through more than 90 key technologies. It is the gas turbine with the largest power and the highest technical level independently developed in my country. It has a significant driving effect on the progress of basic disciplines of gas turbines in my country and the development of industrial technology, and is of great significance to ensuring my country's energy security and green development. The world's largest 26MW offshore wind turbine generator set with completely independent intellectual property rights has rolled off the production line. The key components and technologies of the generator, blades, bearings, and electronic control systems of the unit have reached the world's leading level, representing the latest achievements of the rapid technological progress of the entire industrial chain of my country's wind power equipment. The "Shanhe" and "Jianghai" super-large diameter tunnel boring machines with a diameter of more than 16 meters have been put into use one after another. The "Shanhe" is currently the world's largest diameter tunnel boring machine under construction, with a maximum excavation diameter of 17.5 meters, a total length of 163 meters, and a weight of about 5,200 tons; the "Jianghai" is the largest diameter tunnel boring machine independently developed by my country so far, with a maximum excavation diameter of 16.64 meters, a total length of about 145 meters, and a weight of about 5,000 tons. This marks a new leap forward in the development and application of 16-meter super-large diameter tunnel boring machines in my country, and has formed the industrialization development capabilities of the entire industrial chain of super-large diameter tunnel boring machines. The Fangchenggang "Hualong One" demonstration project has been fully completed, driving more than 5,400 nuclear power equipment companies in the upstream and downstream to achieve more than 400 key equipment independence, and has the ability to 100% localize nuclear power equipment, which has effectively promoted the improvement of the resilience and strength of my country's nuclear power industry chain. The world's largest 600-horsepower hybrid tractor has been successfully developed, breaking the bottlenecks of key core technologies such as agricultural machinery power transmission and hydraulic electronic control. At the same time, the concept of new energy vehicles has been integrated into the field of agricultural machinery equipment, promoting the upgrade of traditional agricultural machinery to intelligent agricultural machinery, and helping agriculture to transform from mechanization to intelligence. The world's largest single-set annual output of 1 million tons of propane dehydrogenation project has been put into production, creating 10 global and national first sets of equipment, realizing reactor special valves, product gas compressors, 50 MW positive pressure explosion-proof motors, 169 MW air heating furnaces, axial flow pumps and other equipment innovations, solving some "stuck neck" problems.

(V) Foreign trade export structure continues to optimize

In 2024, my country's machinery industry foreign trade exports will hit a new high, and foreign trade growth momentum and trade structure will continue to optimize. First, the new pattern of diversified and co-progressive foreign trade market has been further consolidated. In 2024, the export volume of the machinery industry to the countries participating in the construction of the Belt and Road Initiative will increase by 14% year-on-year, accounting for 51.5% of the total export volume of the machinery industry, an increase of 1.3 percentage points over the previous year; the export volume to ASEAN, Africa and Latin America will increase by 17.7%, 12.9% and 27.1% respectively, and the growth rate is significantly faster than the overall level of the machinery industry. Second, the export of main engine and complete machine products will maintain a good growth trend, and the export growth rate of general machinery and parts products will continue to pick up. In 2024, the export volume of automobiles will be 6.188 million, an increase of 26.7% year-on-year; among them, the export volume of electric vehicles will be 2.274 million, an increase of 26% year-on-year; the export volume of general equipment such as compressors, pumps, valves and basic parts such as bearings, fasteners, springs and seals will all achieve double-digit growth. Third, the export of general trade with high technical content will continue to increase. In 2024, the export volume of general trade will increase by 14.5%, 3.5 percentage points higher than the growth rate of all exports of the machinery industry; the export volume of general trade will account for 74.3%, an increase of 2.2 percentage points over the previous year.

3. Prediction of the situation and trend in 2025

Looking forward to 2025, the internal and external environment facing the machinery industry will remain complex and severe, but favorable factors supporting the high-quality development of the industry will continue to gather and increase.

(I) The external environment is becoming more severe and complex

First, the overall global economic growth rate will shift downward. The International Monetary Fund (IMF) expects the world economic growth rate to be 3.3% in 2025, and the growth rate will generally remain at around 3% in the next five years, both lower than the historical average of 3.7% before the epidemic (2000-2019). Second, the international trade environment has deteriorated. Globalization has encountered headwinds, trade protectionism is prevalent, and geopolitical conflicts continue. In the past 10 years, the growth rate of global trade has been lower than the growth rate of global GDP, which is contrary to the trend of the previous 20 years. Third, foreign trade frictions have intensified. The number of economic and trade reviews involving China in developed economies such as the United States and Europe and some developing countries has increased significantly, especially the imposition of tariffs on electric vehicles by many countries, the implementation of carbon tariffs, and the recent announcement by the United States to impose a 10% tariff on Chinese goods. These measures have brought severe challenges to corporate exports.

(II) The overall domestic environment continues to improve

First, macroeconomic policies are favorable. The Central Economic Work Conference pointed out the direction for work in 2025, put forward five "must be coordinated", deployed nine key tasks, and pointed out five "targets", providing a fundamental guideline and action guide for future economic work, including the development of the machinery industry. Second, the macroeconomic environment continues to improve. The fundamentals of my country's economy and favorable conditions such as a broad market, strong economic resilience and great potential have not changed; various macroeconomic policy measures have been introduced in succession, and the momentum of industrial economic development has continued to accumulate. Third, the policy of strengthening and expanding the scope has driven market demand to continue to improve. The "two new" policies have been introduced and quickly implemented in 2025, which will drive the domestic demand market for machinery products to continue to recover and improve. Fourth, the development trend is favorable. The Central Economic Work Conference clarified a number of supporting action plans and implementation plans, most of which are closely related to the machinery industry, which will bring new development opportunities to the machinery industry.

(III) The endogenous driving force of industry development remains strong

The machinery industry has a stable foundation, strong resilience and great potential. First, the machinery industry has advantages such as a complete industrial system, increasingly improved infrastructure and super-large-scale market, a high-quality talent team and a constantly innovative corporate culture, and good opportunities for exchanges, cooperation and common development with advanced domestic and foreign enterprises. These advantages provide a solid foundation and broad space for our future development. Second, the machinery industry will continue to deepen the supply-side structural reform, adhere to innovation-driven and integrated development, cultivate and expand new momentum and new advantages, promote high-end, intelligent, green and integrated development, continuously improve the resilience of the industrial chain and supply chain, and continuously enhance the endogenous driving force for the development of the industry. Third, the industry and enterprises have worked hard and their motivation has not diminished, especially the majority of enterprises have overcome difficulties, stabilized growth and maintained the overall situation, and played an important engine and supporting role in the development of the industry.

(IV) There are still some difficulties and challenges in the development of the industry

First, market demand is sluggish. In 2024, the manufacturing industry's backlog order index continued to be at a low level below the critical value, and the machinery industry order index at the end of the year fell by about 5 points from the mid-year high. Second, product prices continued to fall. In 2024, the overall decline in the ex-factory price index of the machinery industry was about 2%. The automobile, machine tool, photovoltaic equipment, robot and other industries reflected that price competition was very fierce. Third, the profit level has declined significantly. In 2024, the total profit of the machinery industry has continued to decline year-on-year since March, and the annual profit margin has dropped by 0.5 percentage points compared with the previous year. Fourth, the pressure of difficult account recovery has increased. In 2024, the total amount of accounts receivable in the machinery industry reached 9.1 trillion yuan, setting a new annual high, and the average collection period of accounts receivable was 32.7 days higher than that of the national industry. Fifth, some enterprises are in production and operation difficulties. In 2024, the loss of loss-making enterprises in the machinery industry increased by 26.4% year-on-year, and the growth rate was 14.6 percentage points higher than that of the national industry.

(V) Prediction of the operation trend in 2025

In general, the future development of the machinery industry will still be a coexistence of opportunities and challenges, but opportunities outweigh challenges, and favorable conditions are stronger than unfavorable factors. Comprehensively judging, it is expected that the machinery industry will continue to maintain a steady development trend in 2025 and continue to play the role of an important engine of the national economy. The growth rate of major economic indicators is expected to be around 5.5%, and foreign trade will remain basically stable.

2025 is a critical year for the machinery industry to implement the decisions and deployments of the Party and the State, achieve the conclusion of the "14th Five-Year Plan", and lay a solid foundation for the start of the "15th Five-Year Plan". The machinery industry will adhere to the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, fully implement the spirit of the 20th National Congress of the Party, the Second and Third Plenary Sessions of the 20th Central Committee, and thoroughly implement the deployment of the Central Economic Work Conference. Adhere to the word "do" first, strengthen confidence, face difficulties, work hard, ensure that all decisions and deployments of the Party Central Committee are implemented, adhere to the leadership of scientific and technological innovation, accelerate the promotion of industrial upgrading, cultivate and expand new quality productivity, and solidly promote high-end, intelligent, green, and integrated development. Strengthen industry self-discipline, accelerate the construction of a modern industrial system for the machinery industry, and complete the goals and tasks of the "14th Five-Year Plan" with high quality, lay a solid foundation for a good start of the "15th Five-Year Plan", and contribute to promoting the high-quality development of the machinery industry and building a strong manufacturing country.