Since early 2013 loader sales fell 32%

February China loader sales data released in March 11th. Total sales for the month of 8170 units (including exports), the beginning of the year to date sales of 16874 units, down by 32% (excavator sales so far this year fell by 47%). Year to date domestic sales of 13711 units, down by 35%; export sales of 3163 units, down by 16%.
 
Potential impact
1) since the beginning of the loader sales remained weak: domestic sales decreased 35% year-on-year, with 2012 annual decline, while export sales also turned negative growth (an increase of 21% in 2012), partly because last year 1-2 strong exports (up 37%). We expect 2013 loader sales will grow 11% year on year, the implied first quarter sales growth of up to 5%. If the current weak trend continues, then we may face some downside risks to sales assumptions.
2) from the point of view of tonnage loader, excavator and similar trend: small (below 3 tons) performed better than the mainframe, because the latter is the mining industry downturn dragged down capital expenditure.
3) analysis of the provinces also confirms our observation of tonnage: Shandong, Inner Mongolia and other provinces so far this year sales fell about 50%, while Guizhou and Sichuan decreased by 20% year-on-year (similar to excavator market trends).
4) four brands (Liugong, Shandong Lingong, and lonking the Xiagong) to since the beginning of the total market share fell from 64.8% in 2012 60.9%, the biggest loss of lonking (from 14.8% in 2012 to the date of the beginning of 12.9%), while the market share of a slight recovery in Xiamen (from 12.5% in 2012 to the beginning of since 13.3%).
Liugong has the highest market share of 17.8%, Volvo holdings of Shandong Lingong with 17% market share ranked second. Since the beginning of Shandong Lingong is the largest export enterprise to the overseas market, sold 723 units (accounting for 25% of total sales).