2012 China's various types of castings total production of 42.5 million tons, compared with 2011 year-on-year growth of 2.4%, the growth rate slowed sharply.
Downstream industry castings demand structure changes obviously. According to the demand of castings in various industries, automobile castings accounted for One-fourth, the change of automobile output and structure had great influence on the total quantity of castings, and the demand of all kinds of pipe fittings accounted for 12.2%.
Although China has been a veritable casting country, but the quality of casting products and international advanced level there is a clear gap. Most of the product quality indicators have a phased gap, imitation of much less innovation. Some product quality standards themselves have a clear gap. The whole process has poor control, good time difference, and lack of stable quality.
Product market is not smooth to promote some of China's casting enterprises to fight the price of war, a stone to arouse the thousands of waves, soon price war in China's low-end castings in the field of production rapidly spread, so that the whole of China's low-end casting products market smoke.
In the case of double growth of raw materials and labor costs, China's casting industry has no surplus profit space to carry out price promotion activities, not to mention the low value-added products of the low-end castings production enterprises. The reason that the low-end castings production enterprises repeatedly reduce the price of shipments is that China's low-end castings overcapacity, the homogeneity of the products is serious. The above two factors cause the low-end castings production enterprises in China a large backlog of casting products, in order to reduce inventory pressure, defeated opponents, low-end casting production enterprises played a price war, or even at lower cost price to carry out vicious competition.
This kind of poison competition mode not only disrupts the normal market order of casting trade, but also accelerates its extinction rate.