GUANGZHOU, CHINA — What's being called the “new normal” for China's economy — a period of slower, more moderate economic growth — may not be a bad thing for the plastics machinery industry. For some higher-priced foreign machine makers, it could be a good development.
At least that's the argument put forward by a number of industry executives at the recent Chinaplas trade fair.
To be sure, signs of a slowdown were evident: Germany, which has the largest market share of plastics machinery in China among foreign countries, said its exports dropped 5.5 percent last year.
And China's largest local injection machine maker, Haitian International Holdings Ltd., said its domestic sales only rose 1.9 percent last year.
But walk the halls of the huge Chinaplas, which ran May 20-23 in Guangzhou, and you hear repeatedly that the slowdown doesn't mean so much because China remains the world's largest market, and the slower growth is prompting more focus on automation and higher-end equipment, where the overseas firms say they're strongest.
“The clear perspective on the long run is China will be a growing market for us not only for our exports but also for our production here in China,” said Thorsten Kühmann, managing director of the German trade group VDMA's plastics and rubber machinery committee. “China remains to be the biggest export market for German suppliers of plastics and rubber machines.
“The exports of German plastics and rubber machines to China were down by 5 percent last year, in 2014,” he said. “Is this really a drama for our industry? Clearly, no, it's no drama.”
Germany last year exported 809.3 million euros ($889 million) worth of plastics and rubber machines to China in 2014, down from 855.9 euros million in 2013. But 2014 was still the second highest export figure in the past five years for German firms.
“Although the international media often comments critically on the declining market dynamics, we view this ‘new normal' positively,” said Gero Willmeroth, sales and service president at Engel Machinery (Shanghai). “The markets have reached a certain maturity. Quality is increasingly coming into focus.”