Over the next five years, competition will intensify in the global and Chinese construction machinery industries alike. Competition among enterprises will become more systematic, comprehensive and in-depth. The next round of competition therefore means a new elimination phase for China's construction machinery industry.

These are thought-provoking remarks that Wang Min, Chairman of XCMG Group, has once again made publicly about the development of the construction machinery industry. Wang Min frequently issues such warnings in the industry, and it can be said that he does so on any suitable occasion. For example, on August 31 this year, at the 2013 China Top 500 Enterprises Release and China Large Enterprise Summit, Wang Min made a striking statement: "Innovation is driven by competition and forced by the need to survive better. An enterprise that does not innovate is waiting to die."

Why does Wang Min often make such warning remarks? In the view of a reporter from China Deep Foundation Engineering, this is mainly based on the following aspects:

First, it is based on his deep attachment to and sense of responsibility for the development of the construction machinery industry. This is the most basic and also the most important aspect. The reason is simple: even laypeople probably know that if a person does not care about something, he will not pay attention to it, let alone express opinions and views on it. Wang Min's frequent warnings to the industry stem from the fact that he has devoted almost his entire life to construction machinery work and is filled with deep affection for this industry. Therefore, he has a deep emotional bond with the industry and, politically, the ambition and vision to revitalize the national industry. Whenever he sees twists and turns in construction machinery, he cannot help but speak his mind and tell the truth about the industry's development. Otherwise, he could simply remain silent.

Second, it is based on in-depth judgment of the development trends of the construction machinery industry. Wang Min pointed out that the global construction machinery industry is still in an adjustment stage, with shrinking market demand and increasingly fierce industry competition, but the current pattern of converging strategic choices will not last. In a few years, with the integration of Chinese and foreign-funded enterprises at both high and low ends, the construction machinery industry is bound to enter a post-competition era globally. At that time, enterprises will move from competition to co-opetition, from single-product competition to global brand competition, and the global market landscape will also change. Only someone with deep experience in running an enterprise and a thorough understanding of industry development trends could say such things. Undoubtedly, fierce competition will not simply repeat at a low level, nor will it tolerate convergence; instead, it will continuously advance to higher stages and levels. The result is that higher-level co-opetition prevails over lower-level competition, and single products are dissolved by branded products. This is both the inevitability of market competition and the law of development of things.

Third, it is based on great confidence in XCMG Group's development over the years. XCMG has grown step by step to become a domestic construction machinery giant and has also entered the top ten global construction machinery enterprises. According to the company's ambitions, Wang Min said XCMG Group wants to challenge Caterpillar, the international construction machinery leader, and become the world's No. 1 in construction machinery. With strong confidence, the ambition and weight revealed in his words are admirable. To this end, he proposed the distinctive "XCMG Three Theories," namely the "Everest Summit Climbing Theory," the "Medium-Speed Mindset Theory" and the "Forward-Looking Steering Theory," which have triggered deep thinking among many industry insiders. The "Everest Summit Climbing Theory" means that XCMG will gather more financial resources, wisdom and talent, and muster its energy to conquer the last few hundred meters and the final 10% of the toughest challenges in the construction machinery industry, likened to Mount Everest. The "Medium-Speed Mindset Theory" means that in the face of industry decline, insufficient demand and overcapacity, XCMG must adjust from the high-speed mindset of the high-growth period to a medium-speed mindset. The "Forward-Looking Steering Theory" emphasizes that when facing economic slowdown, enterprise leaders must not merely possess emergency response capabilities; they must use a highly forward-looking vision to foresee possible changes ahead under high-speed development and think through new paths in advance. Behind XCMG's horizontal leap to a scale of "100 billion yuan," it will accelerate innovation-driven development and transformation and upgrading, relying on the most essential growth driver of superior products and technologies that are the world's largest, China's most advanced and overwhelmingly advantageous in high-end markets. It will strengthen control and allocation of global industrial resources, stimulate and consolidate new competitive momentum for international development, and provide comprehensive and systematic solutions that highlight user value, XCMG value and world-class brand reputation. It will continue to strengthen the penetration and spread of XCMG's positive energy and influence globally, and build a world-class enterprise that is solid, enterprising and full of vitality, highly internationally competitive and a source of pride for the Chinese people. While these bold words and grand aspirations are deeply inspiring, given XCMG's current strength and development momentum, probably no one would doubt them.

Fourth, it is based on sincere warnings to peers, especially some weaker enterprises. To the industry, especially some not-so-strong enterprises whose thinking and concepts lag behind and who still fantasize about relying on business relationships and improper means to survive, he frequently issues sobering warnings. On the one hand, this serves an important warning function for these enterprises, thereby enhancing their sense of crisis; on the other hand, it is more conducive to encouraging the industry to guard against arrogance and rashness and to keep striving forward.

Therefore, the author believes that every time Wang Min speaks, he does so with great purpose. His high sense of professional responsibility is evident, demonstrating the high awareness and magnanimous style of Wang Min as Chairman of XCMG Group and an outstanding managerial figure in the construction machinery industry.

Editor: Wu Yue