The German exhibiting delegation has been a prominent highlight in China International Machine Tools Show that is one of the world's 4 major machine tool exhibitions and closed recently. 156 German companies of the machine tool industry took part in the show, occupying an exhibition area of 8,600 m2. They demonstrated innovative products and solutions that targeted the full range of China's industry, including machine tools for cutting and non-cutting industries, laser and non-laser metal plates processing technologies, control system, cutting tools, and production measurement and clamping tools, etc.

Hein, market director of VDW, suggested that the reason why German machine tool manufacturers had been so enthusiastic in participating in the show was that machine tools trade between China and Germany had been showing signs of significant bidirectional growth in recent years.

According to Mr. Hein, in 2010 China ranked 7th on the list of suppliers of important machine tools of Germany's industry sector. The 2009 financial crisis slowed down the growth of China's machine tools supply, but in 2010, the supply was back on track once again. In 2010, Germany imported Euro 74 million worth of machine tools from China, an increase of 50 percent over 2006, main imported products including parts, accessories, and machine tools.

China is the biggest machine tools market in the world, and also the largest machine tools importer worldwide. In 2010, 21 percent of China's imported machine tools came from Germany. This means that Germany has become the second largest machine tools supplier for China's industry sector, only after Japan.

Since 2006, Germany's machine tools export has doubled, not very significantly affected by the international financial crisis. Since the end of 2009, orders have been witnessing 2-digit growth, with some months enjoying 3-digit growth in the second half of 2010. The entire year of 2010 witnessed an increase of 85 percent of order quantity, with a delivery of Euro 1.7 billion worth of machine tools.

VDW estimates that machine tools production in Germany in this year will increase by 30 percent, scoring the highest growth in the history of the industry. This rising trend is mainly supported by the 30 percent prototyping technologies of Germany's machine tool industry, including processing centers, grinding machines, refining machines, polishing machines, and gear processing machines. Metal sheets pressing, in particular, boasts shorter delivery time in comparison with iconic project-oriented pressing technologies.

This change happens when the global machine tools industry is adjusting. The international financial crisis has caused global machine tool industry to adjust and reform. In 2010, global production of machine tools increased by 25 percent over the previous year, with the driving force of the growth coming mainly from Asia. South Korea, Japan, and China witnessed 2-digit growth of machine tools production. The ranking of the world's largest machine producers has changed significantly, with China topping the list for the first time. According to international economists, global machine tools consumption in 2011 will increase by 20 percent, and three fifth of the sale will be in Asia.

The machine tools industry is a demand-driven industry. For example, the change of manufacturing material will drive the industry to innovate, optimize production procedure, and design specialized equipments. Wolfgang Horn, vice chairman of MAG global technology, believes that, based on the future development trend, machine tool enterprises should evolve from pure manufacturers into solutions providers, supplying complete solutions for production technology and other aspects. "German machine tool manufacturers possess advantages in this aspect", said Hein. They can transfer their production capability from one field to another. For example, they can use high precision production technologies to meet the demands of the medical technology industry and the aviation industry that have stringent requirements on relevant products and require highly specialized products.

Wolfgang Horn believes that China's machine tool industry, which possesses good technology foundation and is developing very rapidly, needs to promote the advancement of its technology through more innovations, so as to adapt itself to the development trend of the global machine tool industry. Hein agrees with this point of view, too.

According to Hein, German machine tools manufacturers attach great importance to innovations. Most medium-sized machine tool manufacturers in Germany spend a significant part of their revenue on R&D. An example is that during the global financial crisis, they retained the majority of their technology researchers in spite of decreasing orders. They invested resources into R&D of new products. It is because of these innovations during that period that orders have been increasing considerably in the past two years.

Wolfgang Horn suggested that Chinese machine tools companies, while competing with their German counterparts, should also work extensively with German companies, such as establishing technology bases, co-developing machine tool products, and expanding into more emerging markets.