In early 2013, the debate over whether to "ban" or "not ban" imported used construction machinery pushed the issue into the spotlight. Today, with used construction machinery auctions held multiple times and a Used Equipment Expert Committee established, some of the problems surrounding used equipment may be resolved.
Whether they are manufacturers, dealers, auction houses, or individual private owners, all shake their heads at the current used construction machinery market, which can be summed up in one word: "chaotic." Since the used construction machinery market came into existence, it has always lacked effective management, leaving many users at a loss.
The lack of an authoritative and large-scale trading platform, high tax rates, and the absence of an exit mechanism—these are all soft wounds.
Buying used construction machinery in Guangzhou requires a pair of "piercing eyes"
At the beginning of the year, an industry insider's remark that "China has become a dumping ground for used construction machinery" pushed the debate over whether to "ban" or "not ban" imported used construction machinery into the spotlight, and the subsequent bustling used machinery auctions drew even more attention to China's used construction machinery industry. So, is used machinery really garbage? If it is garbage, why does it win customers' trust so deeply? Chen Zhenbang (General Manager Chen), general manager of Guangzhou Fubang Used Machinery Parts Co., Ltd., gave his own answer: "Whether the used machinery you buy is garbage depends on whether the buyer has a pair of 'piercing eyes.'"
General Manager Chen said that Shenzhen's used machinery market has a long history. Starting in the 1980s, Shenzhen and Guangzhou, with convenient transportation and proximity to Hong Kong, were able to import some excavators from Hong Kong, though these excavators could not be resold privately at the time. It was not until the 1990s that large numbers of excavators were imported. Therefore, the Shenzhen construction machinery market, which initially gained fame, relied mainly on imported machinery, as there were no real domestic construction machinery brands at that time, and imported machinery was favored by industry insiders. But an excavator cannot be used indefinitely; after being scrapped and retired, some of its parts can still be used—especially general components such as chains and undercarriages, which can still circulate in the market. This subsequently drove the development of the used parts market.
General Manager Chen does not quite agree with the view that used machinery is garbage. Having worked in the used machinery market for nearly more than 20 years, he admits that entering the used machinery market was not his own choice; at first, he only wanted to use used machinery as a sharp weapon to carve out a path. But after truly entering this market, he discovered that it is also a gold mine. Because of their low prices and small depreciation rates, a good piece of used equipment generates relatively good economic benefits, so it is especially favored by individuals and private owners, who use small costs to create big benefits. Among them, used imported machinery has a larger market in China—in Shenzhen alone, tens of thousands of units can be sold in a year—while domestic-brand used machinery, although not comparable to imported machinery, still occupies a certain share. The prosperity of used machinery has also led to chaos in this market, but General Manager Chen believes that, whether for complete machines or parts, counterfeiting is not particularly serious; for used machinery, customers are more concerned about quality and price.
General Manager Chen explained that when selecting used machinery, especially parts, one must look at the actual item. In this market there are no brands and no reference solutions; to buy good products, one must have rich experience and develop a pair of piercing eyes so as not to get caught in muddy waters. In the years of Fubang Machinery's operation and development, what it has valued most is strict quality control, which is how it has won batch after batch of customers. In other machinery markets, there may be no such thing as after-sales service for used machinery: as long as you like a product and pay for it, you can take it away. Once it leaves the store, the seller need not be responsible for any problems with the product.
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