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Malaysian Reserve
2 days ago
- Business
- Malaysian Reserve
Chinese EV trucks will build our future cities
IF YOU think the world is starting to get used to surging sales of Chinese-made electric cars, the next wave of exports is going to be bigger, and more powerful. That's because the construction machinery giants that grew fat off the country's property bubble are looking for new markets to offset the downturn at home. Combined with looming electrification, the effects could be quite as dramatic as the other Made-in-China export booms which have so troubled trading partners. Consider Sany Heavy Industry Co. In 2020, 83% of its business was selling excavators, cranes, concrete mixers and the like to domestic developers. In the space of just four years, China's property crash has caused its turnover in that market to shrink by two-thirds. Overseas markets now account for more than 60% of revenue. It's hoping to raise US$1.5 billion (RM6.55 billion) via a Hong Kong IPO to help it double international sales to 100 billion yuan (RM60 billion), the South China Morning Post reported last month. Sany isn't alone. Its local rivals XCMG Construction Machinery Co, Zoomlion Heavy Industry Science & Technology Co and Guangxi LiuGong Machinery Co are all facing the same collapse of activity on the home front, where housing starts in the first four months of 2025 fell to their lowest level since 2003. That's left dismal returns on all the assets they built to service a market that's since disappeared — below 5%, less than half what Caterpillar Inc manages and well below the 7.7% at Komatsu Ltd. The best way out of this problem is to find export markets to get the production lines for all those diggers, dozers, lifters and trucks humming again. Zoomlion's international sales have followed Sany's in becoming the largest element of its revenue, and XCMG and LiuGong aren't far behind. There's plenty of work to go around. In the Persian Gulf, governments are using the windfall from the oil boom of the early 2020s to build a swath of major infrastructure projects, from the Middle East's first Walt Disney Co theme park in Abu Dhabi, United Arab Emirates, to a new international airport in Riyadh, Saudi Arabia, and a US$22 billion, five-year infrastructure plan for Qatar. Construction markets are also booming across South and SouthEast Asia and in parts of Africa. China's export market share in major categories of work vehicles has soared in recent years. As with passenger cars, electrification offers a potent route for further disruption. Batteries are often considered an ill fit for construction machinery, which has extreme power needs that diesel is particularly well-placed to deliver. But that's changing as lithium-ion cell-makers build cheaper and longer-lasting power packs that can often keep running as long as an eight-hour work day, according to IDTechX, a consultancy. Electric construction equipment sales will grow at 21% annually up to 2044, when they'll hit US$126 billion, IDTechX predicted last year. Chinese manufacturers have an advantage here. Local battery-makers Contemporary Amperex Technology Co and BYD Co are market leaders in LFP (lithium ferrophosphate), the cathode chemistry that's likely to be best-suited to site vehicles, thanks to its stability and low costs. Already, local construction machinery manufacturers produce about two-thirds of the electric bucket loader models on the market. Circumspect governments should be looking at ways to outcompete this shift. Instead they're raising the drawbridge. The European Union (EU) in April set tariffs as high as 67% on Chinese construction machinery, while the UK has more recently imposed duties of more than 30% on excavators made by Sany, Liugong and XCMG. The Indian joint venture between Tata Motors Ltd and Hitachi Construction Machinery Co last year called on New Delhi to raise levies against imported Chinese products, saying they'd already grabbed 22% of the market. Things are even worse in the US, where the US President Donald Trump administration is busy unpicking the heavy-duty vehicle emission standards introduced by former President Joe Biden. That removes much of the incentive for US-exposed manufacturers such as Caterpillar, Komatsu, Volvo AB and Deere & Co to innovate and compete with the coming onslaught. Work vehicles have tended to fly below the radar in discussions of urban emissions, but their vast size and power requirements give them a disproportionate share of engine pollution. China's 10 million construction machines emit more particulates than its 417 million road vehicles, according to the International Council on Clean Transport. With low-emission zones spreading across cities worldwide and older diesel vehicles increasingly restricted on the roads of major cities such as London, Paris and Madrid, construction machinery is increasingly going to find itself in the crosshairs as one of the biggest contributors to urban pollution. When that happens, Chinese manufacturers will have a solution ready to be driven from their parking lots. Will their incumbent overseas competitors be ready, too? — BLOOMBERG This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners. This article first appeared in The Malaysian Reserve weekly print edition
The Star
29-05-2025
- Business
- The Star
Bank counters weigh on FBM KLCI after recent earnings reports
KUALA LUMPUR: The local stock index drifted lower in the early session as investors sold down financial heavyweights following their recent earnings announcements. The FBM KLCI was down 1.29 points to 1,525.60 at the midday break, as the domestic market shrugged off a global rally sparked by a US trade court's decision to block US President Donald Trump's tariffs on trading partners. On the broader market, the number of declining issues piped advancers 430 to 400 after 2.16 billion shares changed hands for RM1.06bil. Hong Leong Bank weighed on the market as traders sold down its shares by 28 sen to RM19.62 on the back of its earnings report yesterday. Sector peer RHB, which also released its earnings yesterday, fell 14 sen to RM6.53. Other laggards included Telekom down 30 sen to RM6.55, Guan Chong sliding 18 sen to RM3.25 and Sunway Construction dropping 12 sen to RM5.83. Key Asian markets maintained a rally on news of a potential reprieve in US tariffs imposed on the rest of the world. Japan's Nikkei rose 1.53% to 38,297 while China's blue-chip CSI 300 gained 0.68% to 3,862 and Shanghai's composite index rallied 0.72% to 3,363. Hong Kong's Hang Seng climbed 0.65% to 23,408.
The Sun
26-04-2025
- Business
- The Sun
MCMC conducts 1,257 wireless broadband quality tests nationwide
SANDAKAN: The Malaysian Communications and Multimedia Commission (MCMC) has carried out a total of 1,257 mandatory standards testing sessions for wireless broadband service quality (MSQoS) across the country in the first quarter of this year. Communications Minister Datuk Fahmi Fadzil said that of the total, 196 testing sessions were conducted in Sabah. He said that based on monitoring and regulatory activities, this year, 135 notices under Subsection 51(2) of the Communications and Multimedia Act 1998 have been issued to telecommunications companies. 'Between 2023 and 2024, a total of 46 penalties amounting to RM6.55 million in compounds were imposed for non-compliance with MSQoS,' he told reporters after attending a coverage testing session at the Tourism Centre in Sepilok Orangutan Rehabilitation Centre and the Rainforest Discovery Centre (RDC) here today. Fahmi stressed that MCMC would continue its monitoring and regulatory efforts and would not hesitate to enforce the legal provisions in place to ensure that service providers comply with the current MSQoS coverage standards. The Minister also noted that MCMC is working closely with mobile network operators to ensure continuous efforts by telecommunications companies to improve network quality and coverage. 'All service providers are urged to take public complaints seriously and act swiftly to resolve them,' he added.
The Sun
26-04-2025
- Business
- The Sun
MCMC conducts 1,257 wireless broadband quality tests nationwide in Q1 2025
SANDAKAN: The Malaysian Communications and Multimedia Commission (MCMC) has carried out a total of 1,257 mandatory standards testing sessions for wireless broadband service quality (MSQoS) across the country in the first quarter of this year. Communications Minister Datuk Fahmi Fadzil said that of the total, 196 testing sessions were conducted in Sabah. He said that based on monitoring and regulatory activities, this year, 135 notices under Subsection 51(2) of the Communications and Multimedia Act 1998 have been issued to telecommunications companies. 'Between 2023 and 2024, a total of 46 penalties amounting to RM6.55 million in compounds were imposed for non-compliance with MSQoS,' he told reporters after attending a coverage testing session at the Tourism Centre in Sepilok Orangutan Rehabilitation Centre and the Rainforest Discovery Centre (RDC) here today. Fahmi stressed that MCMC would continue its monitoring and regulatory efforts and would not hesitate to enforce the legal provisions in place to ensure that service providers comply with the current MSQoS coverage standards. The Minister also noted that MCMC is working closely with mobile network operators to ensure continuous efforts by telecommunications companies to improve network quality and coverage. 'All service providers are urged to take public complaints seriously and act swiftly to resolve them,' he added.
