CNC Machine Tool Industry in Progress: How Private Enterprises Can Leap Forward

At present, China’s independent innovation in high-end CNC machine tools is still underway, and the industrialization of independent innovation results is accelerating. In the R&D of heavy and super-heavy CNC machine tools, a batch of high-end CNC machine tools reaching internationally advanced levels — such as heavy gantry five-axis linkage compound machine tools and super-heavy CNC horizontal boring and turning machines — has been successfully developed, meeting the key processing needs for extra-large parts in key fields such as aerospace, power generation equipment and automobiles. High-speed precision CNC lathes and machining centers are widely used in automobiles, aerospace, electronics, military and many other industries, driving the equipment renewal and industrial upgrading of numerous small and medium-sized enterprises.

Domestic machine tool enterprises have vigorously implemented technological innovation and made significant progress in product structure adjustment. To adapt to changes in market demand, many machine tool enterprises have reduced production of low-end and ordinary products, accelerated the upgrade of economical CNC machine tools, and focused on developing mid-to-high-end CNC machine tools and production lines.

But how can private CNC machine tool enterprises escape marginalization? This has become a topic of wide concern.

CNC machine tools are technology-intensive and capital-intensive products. Currently the market is dominated mainly by large state-owned enterprises and multinational companies. Private enterprises, starting from a low base and entering the market late, are constrained by capital, technology and management, and are in a marginalized position in market competition. Their market is concentrated mainly in the mold sector with limited development space, making it difficult to achieve much. How private CNC machine tool enterprises can escape marginalization has also become a key issue.

First, let us start with the entry point of private machine tool manufacturers. Because the mold market has a low entry barrier and relatively low requirements for the professional technical quality of sales personnel, most private manufacturing enterprises initially entered the machine tool market by serving mold enterprises. However, mold enterprises are small in scale and strength, sensitive to machine tool prices and payment terms; they order small quantities at low values at a time, and generally lack sufficient capital budgets. Parts manufacturing customers are different: they order relatively more machine tools at a time with higher values, have sufficient capital budgets, and have a high probability of repeat purchases.

In addition, because mold users operate machine tools in harsh environments with long-term overload, and the users themselves lack the necessary conditions for machine tool maintenance and care — including the corresponding technology, facilities and personnel — machine tool failures are frequent and problems keep occurring during use. This exhausts the equipment suppliers while the users complain constantly. Parts users are relatively much better: the machine tool operating environment is relatively friendly, operation follows strict procedures, and the equipment department arranges regular maintenance. Therefore, after solving their survival problems, private CNC machine tool enterprises should quickly shift toward the parts manufacturing field.

Therefore, marketing capability building is the final risky leap for private CNC machine tool enterprises. Only after this final risky leap can the CNC machine tools made by private enterprises ultimately reach users. The content of marketing capability building for private CNC machine tool enterprises includes industry research, sales process control, channel building, sales team building, market promotion, and pre-sales and after-sales service. With strong marketing capability, enterprises no longer pin their development on a few hero-style salespersons, and their development will not be led by the nose by salespersons, thus firmly grasping the initiative in enterprise development.

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