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British media worries: China's concrete industry has a financial bubble
Concrete has been the core of China's economic growth for many years, and the speculators who entered the bank have never backed down. Few small concrete mixers commonly found on construction sites are owned by the company. It is said that in recent years, it is common for ordinary Chinese households to borrow money to buy mixers and then rent them out to collect cash.
Many people worry that the concrete industry, an important part of the industry, has also bred a financial bubble. Some of the major players in the field of concrete machinery in China, heavy industry enterprises, are in the shadow of complicated finance woven by banks, machinery manufacturers, and concrete producers.
They rely on supplier financing to promote sales of concrete mixers. But some people worry that the buyer of the mixer will use the new machine as collateral in exchange for more loans. Then, they sold the unprocessed concrete on credit to real estate developers who were short of cash.
According to the results of market research conducted in Jiangsu, more than half of the concrete mixers sold by certain heavy industry companies in the first quarter have not been started at all. Buyers store the machines in the warehouse and only want to use the mortgage loan to obtain funds to pay wages, electricity bills and purchase raw materials. In order to get more loans, they will buy more machines that exceed demand. The analyst who participated in the survey said.
At present, Beijing is trying its best to suppress the real estate industry to balance the economy, instructing banks to reduce lending to the industry, causing many developers to withdraw from the market. Nevertheless, when the sales of international competitors such as Caterpillar are declining, the sales of mixers of some China Heavy Industries (5.53, -0.06, -1.07%) companies still maintain strong growth. In contrast, Caterpillar said that the first quarter overestimated the demand for construction equipment in the Chinese market, and it is expected that sales in China this year will face a 5% to 10% decline.