Behind the impressive financial report numbers lies the most profound paradox in China's construction machinery industry - the hotter the manufacturer's financial report, the more difficult it is for agents to survive.
In the first half of 2025, the construction machinery industry has delivered an enviable performance report. More than 80% of enterprises have achieved a "double increase" in revenue and net profit. Sany Heavy Industry's profit exceeded 5.2 billion yuan, a year-on-year increase of 46%, while XCMG Machinery's operating revenue reached 54.808 billion yuan, a year-on-year increase of 8.04%.
Top companies in the industry have seen a double increase in revenue and net profit growth, with impressive performance in overseas markets. The sales of excavators increased by 25.2% year-on-year, and the construction machinery industry seems to have emerged from the downward cycle of the previous two years and ushered in a new round of growth.
However, beneath this prosperous scene, there is widespread sorrow among agents. The contradiction between "manufacturers need scale, agents need survival" has never been so sharp.
Hot financial reports, hidden worries behind the numbers
The construction machinery industry shows a strong recovery momentum in the first half of 2025. Sany Heavy Industry achieved a revenue of 44.534 billion yuan, a year-on-year increase of 14.96%. Its sales revenue of mining machinery increased by 15.00% year-on-year, and the sales revenue of lifting machinery increased by 17.89% year-on-year.
XCMG Machinery also performed well, achieving a revenue of approximately 54.808 billion yuan in the first half of the year, a year-on-year increase of 8.04%. Zoomlion achieved a revenue of 24.855 billion yuan, a year-on-year increase of 1.30%.
The growth of net profit is even more astonishing. Sany Heavy Industry's net profit attributable to its parent company was 5.216 billion yuan, a year-on-year increase of 46.00%, while XCMG Machinery's net profit attributable to its parent company was 4.358 billion yuan, a year-on-year increase of 16.63%. Liugong Machinery's net profit increased by 25.05% year-on-year, significantly improving the industry's profitability.
However, behind this glory lies a hidden concern that cannot be ignored: the growth of manufacturers' performance is largely achieved through channel pressure. The inventory level of agents continues to rise, far exceeding the healthy level.
Overseas markets are advancing rapidly, while domestic channels are under pressure and moving forward
Overseas markets have become the main driving force for the growth of construction machinery enterprises. Sany Heavy Industry's overseas sales revenue was 26.302 billion yuan, a year-on-year increase of 11.72%, with overseas revenue accounting for 60.26% of its main business revenue.
XCMG Machinery's overseas revenue was 25.546 billion yuan, a year-on-year increase of 16.64%, accounting for 44.6%. Zoomlion's overseas revenue was 13.815 billion yuan, a year-on-year increase of 15%, accounting for 55.58%.
From January to July 2025, the import and export trade volume of construction machinery in China reached 35.076 billion US dollars, a year-on-year increase of 10.5%. The explosion of the export market has become an important driving force for industry recovery, with excavator exports increasing by 31.9% year-on-year.
But in sharp contrast to the rapid development of overseas markets, domestic channel providers are facing unprecedented pressure. Manufacturers transfer the sales pressure of the domestic market to agents, resulting in high inventory and difficult cash flow for agents.
False prosperity driven by policies?
Domestic demand is gradually recovering under policy drive. The policy of equipment renewal continues to be strengthened, and the State Council's "Action Plan for Promoting Large scale Equipment Renewal and Consumer Goods Trade in" clearly states that by 2027, the investment scale of equipment in industries such as industry, agriculture, and construction will increase by more than 25% compared to 2023.
The issuance of local government special bonds is accelerating. As of August 3, 2025, the total amount of local government special bonds issued nationwide has reached 5179.5 billion yuan. The large-scale investment in water conservancy projects has become the core support, and the national water conservancy construction investment has exceeded 2.5 trillion yuan in 2023-2024.
The hydropower project in the lower reaches of the the Yarlung Zangbo River was officially started, with a total investment of 1.2 trillion yuan and an estimated excavation volume of more than 500 million cubic meters. According to industry estimates, the scale of its construction machinery procurement will reach 120 billion to 180 billion yuan.
However, it is still unknown whether these macro benefits can truly be transmitted to the channel end. The traditional value chain of "manufacturer agent customer" in the construction machinery industry is breaking down, and the growth of manufacturing performance has not correspondingly improved the efficiency of agents.
Deep waters and hot waters: survival crisis of agents
In sharp contrast to the hot industry financial reports is the survival dilemma of agents. In the 2025 era, there will be no significant change in the survival status of distributors, with over 60% of agents in a loss making state and less than 20% able to achieve small profits.
The aging situation of agents is serious. When the previous generation of agents enters the aging stage and the new generation is unwilling to take over, the future direction of the entire agent system in China is worth paying attention to. At present, the dealer's inventory is approximately 1.8 to 2 months of sales, which is higher than the healthy 1.5 month level.
The issue of payment collection also troubles agents. At the end of January, the customer's equipment engineering payment collection rate slightly deteriorated, and some agents reported that the engineering payment collection cycle had been extended, increasing the pressure on the funding chain.
Selling one unit at a loss has become a true portrayal for many agents. Manufacturers constantly increase their sales targets, and agents have to lower prices and promote sales, even offering discounts, in order to meet the targets, falling into a vicious cycle.
Double Squeeze: Scale Pressure and Service Challenges
Agents are facing dual pressures of scale and service-oriented transformation. Manufacturers guide agents to develop towards scale, for example, Liugong needs channels for scale development, hoping that capable and willing agents can achieve a role transformation from "one province, multiple generations" to "one generation, multiple provinces".
Post market services have become an important direction for the sustainable development of agents. Fu Yaosheng, Chairman of Lixingxing Machinery Group, believes that the aftermarket will be the way to survive for sustainable development in the future. But whether manufacturers truly consider the aftermarket as a sustainable development strategy and the position of aftermarket service personnel in the industry are key factors affecting the transformation of agents.
The exploration of the direct sales model has not been smooth. Many companies in the industry, such as Liugong, began to experiment around 2019, but currently the market performance of their directly operated companies is unsatisfactory. The agency model has sustainable mature cases for reference, while there are currently no particularly good benchmarks or cases to replicate for the direct sales path.
What's even more serious is that manufacturers still have a single assessment system for agents: with sales volume and market share as the core indicators, they relatively ignore the profitability and sustainable development of agents. This assessment orientation directly leads to the dilemma of agents.
The way to break through: reconstructing the industry value chain
Faced with challenges, the industry needs to fundamentally reconstruct its value chain. Manufacturers must re-examine their relationship with agents, shifting from a simple stocking relationship to a genuine partnership.
Large scale development requires more rationality. Manufacturers should consciously guide the scale development of agents, not simply through mergers and acquisitions, but to build a future oriented, benign, collaborative and symbiotic relationship.
The service-oriented transformation requires the full support of manufacturers. In the existing market, the main source of revenue for the industry in the future will come from aftermarket services. Agents need to deeply cultivate the existing market, solve problems with parts supply and maintenance, and increase overall after-sales revenue.
The assessment system must be reformed. Top enterprises such as Sany have begun to reduce the assessment of distributors solely based on market share and focus more on assessing their profits. This approach should become a standard in the industry, guiding agents to shift from pursuing scale to pursuing quality and sustainable development.
Industry Future: From Incompatible Water and Fire to Harmonious Water and Fire
The construction machinery industry will focus on three main lines: intelligence, greenness, and high-end. Lv Ying, Deputy Secretary General of the China Construction Machinery Industry Association, pointed out that the industry will focus on promoting industrial infrastructure reconstruction projects and enhancing independent innovation capabilities.
Electrification has become a battleground for military strategists. In July, a total of 2391 electric loaders were sold, with a record high penetration rate of 26.57%. Calculated based on a 30% replacement rate, the annual market for pure electric construction machinery reaches 400 billion yuan.
Sany Group's sales of electrified 名媛直播 exceeded 10 billion yuan in 2024, and companies such as XCMG and LiuGong had already set their sights on electrification 10 years ago. Industry leaders are achieving transformation and upgrading through new energy 名媛直播.
However, the healthy development of the industry requires manufacturers and agents to work together. Only by establishing a more equitable value distribution mechanism can the sustainable development of the entire industrial chain be achieved.
The construction machinery industry is transitioning from "scale expansion" to "quality improvement". Only by achieving collaborative development between manufacturers and agents can the entire industry truly overcome the dilemma of fire and water and usher in sustainable and healthy growth.
The future belongs to those enterprises that can balance short-term performance and long-term development, and balance the interests of manufacturers and the survival of agents. The healthy development of the industry requires a harmonious balance between water and fire, rather than an incompatible opposition.
