A Rational Look at Development: Calculus Interpretation of the Engineering Machinery Market

Recently, industry insiders have analyzed that the engineering machinery market will shift from overcapacity to rational development, showing a positive trend. Although the overall sales volume of most sub-sectors is still declining, the rate of decline has narrowed. In addition, downstream infrastructure funds are gradually being put in place, and the 2012 Shanghai Bauma exhibition is approaching. In the near future, the engineering machinery market will rebound. However, judging from the sales data of engineering machinery, although the negative growth rate has narrowed, it remains negative. If, under the background of no major fluctuations in downstream infrastructure construction and the Chinese economy, the sales volume of engineering machinery and the comprehensive factor variables affecting monthly sales volume will present a continuous function image of y=f(x), where y is the sales volume and x is the comprehensive factor variable affecting sales volume. If the sales volume of engineering machinery is reduced to the limit and viewed using the infinitesimal method, the area of the infinitesimal curve ∫f(x)dx represents the comprehensive performance of the engineering machinery market during the period. If the region [a,b] for the definite integral formula is defined and solvable, the sales volume of engineering machinery will be apparent during any period. The sales increment will be presented as z=dy/dx. Recent Engineering Machinery Sales Statistics In July 2012, the sales volume of engineering machinery products in China remained sluggish. Excavator sales were 5,886 units, down 28.97% month-on-month and 23.21% year-on-year, with a cumulative year-on-year decrease of 37.54% this year; loader sales were 11,713 units, down 21.88% month-on-month and 27.55% year-on-year, with a cumulative year-on-year decrease of 25.80% this year; bulldozer sales were 649 units, down 29.38% month-on-month and 14.72% year-on-year, with a cumulative year-on-year decrease of 36.24% this year; road roller sales were 946 units, down 24.14% month-on-month and 26.38% year-on-year, with a cumulative year-on-year decrease of 43.34% this year; and truck crane sales were 1,501 units, down 28.32% month-on-month and 19.86% year-on-year, with a cumulative year-on-year decrease of 41.41% this year. Compared with June, except for road rollers and cranes, the year-on-year decrease in the monthly sales of major products has expanded. In August 2012, the national engineering machinery industry achieved a total industrial output value of 43.341 billion yuan, an increase of 3.88% year-on-year and a decrease of 4.49% month-on-month; sales output value reached 43.538 billion yuan, an increase of 10.55% year-on-year and a decrease of 5.15% month-on-month. The production-sales ratio in May was 100.5%, down 0.6 percentage points from the previous month. In September 2012, according to statistics: the national engineering machinery industry achieved a total industrial output value of 44.086 billion yuan, a decrease of 6.44% year-on-year and an increase of 1.72% month-on-month; sales output value reached 45.635 billion yuan, a decrease of 0.77% year-on-year and an increase of 4.82% month-on-month. The production-sales ratio in September was 103.5%, up 0.3 percentage points from the previous month. Infinitesimal Analysis of the Market Recent data shows that the increment z=dy/dx of engineering machinery sales is turning from negative to positive. If the sales volume of the engineering machinery market does not experience major fluctuations in the overall environment, the sales volume y=f(x) will show continuous function growth or decline. Although the comprehensive sales volume ∫f(x)dx of the market and the change z of engineering machinery sales have an indirect relationship, under the influence of the comprehensive factor variable x, ∫f(x)dx directly increases with the increase of the change z and optimistically rebounds. In addition, whether the engineering machinery market improves mainly depends on the comprehensive factor variables affecting sales, such as the Chinese economy and downstream infrastructure construction. However, judging from the relationship between the comprehensive sales volume ∫f(x)dx of the market and the change z, the future trend of the engineering machinery market will depend on the growth situation in the next few months. According to the above data, the monthly change in July was -20 percentage points; the month-on-month decrease in output value in August was 5.15%. However, in September, the sales output value increased by 4.82% month-on-month. Judging from the changes in the engineering machinery sales market from 2011 to the present, it will take at least several months to restore the industry to a good state. In addition, considering the impact of the winter season, the author predicts that the engineering machinery industry will recover to a good state in the middle or second half of 2013 under the overall environment of downstream market warming, rational return of enterprises, and economic recovery.