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In recent years, the production, sales, and export volume of domestic drying equipment have been growing at a relatively rapid rate, but the profitability of the production and drying equipment companies is not optimistic. Due to the large number of drying equipment companies and the blind expansion of production capacity, they have failed to gain a controlling position, thus forming a vicious competition market structure in low-value-added production links. Faced with such a strong capital offensive, it is almost a foregone conclusion that domestic dry equipment companies in trouble are being merged and acquired.
Domestic drying equipment companies are in trouble and have provided expansion opportunities for multinational companies that have been entrenching the drying equipment industry in China. When the business cycle of the drying equipment industry is at the bottom, the cost of mergers and acquisitions is even lower, which is more conducive to the acquisition and integration of domestic drying equipment companies by virtue of their capital advantages.
Due to the high cost performance of domestic drying equipment, multinational companies have not been able to achieve a breakthrough in the drying equipment market in China. The acquisition of domestically-made drying equipment companies by multinational companies can prevent other drying equipment companies from challenging their leading position, and they also grasp the resources of the Chinese drying equipment market.
It can be inferred that multinational companies have absolute advantages in product innovation, quality reliability, and after-sales service. The gradual deployment of their industries will lead to deeper competition in the industry, and market sales will be further concentrated in large-scale drying equipment companies. The stronger the stronger, the weaker the weaker.
In the future, the policy support that domestic drying equipment can obtain will be relatively weak. Domestic drying equipment companies need to rely more on their own strength to compete with multinational companies.
Domestic drying equipment should be rescued before the acquisition crisis
China's drying equipment industry is a sunrise industry, and its development has always touched the people. The concentration of domestic drying equipment market in China will be significantly improved, and multinational companies will occupy a more prominent dominant position in the domestic M&A of drying equipment companies.