China’s market for construction equipment remains oversupplied with unsold inventory, according to analysts in a conference call organized by J.P. Morgan Securities JPM, the Wall Street Journal reports. An analyst told the WSJ after the conference that there is about a year’s supply ofavailable for sale in China. The analyst added that production is likely to be down 30 percent to 40 percent from 2012 while dealers work through existing inventories.
, Komatsu and other foreign manufacturers have had significant drops in sales in 2012. Manufacturers of and parts have also felt the sting.
David Phillips, managing director of Off-Highway Research, told the conference that global sales of construction equipment this year will total about $97.7 billion, and although sales in China will rise 6.6 percent to $25.9 billion, they will fall short of the 2011 peak of $37.1 billion.
Phillips said China last year had enough capacity to build 460,000 crawler excavators, more than four times the number sold in 2012, the WSJ said. Off-Highway said Sany Heavy Industry Co. had the largest share of the Chinese excavator market last year with 11 percent, followed by Komatsu at 8 percent, and then Hitachi Construction Machinery and Caterpillar.