China's elevator industry is still in a period of fast development. In 2011, the demand from the downstream indemnificatory housing construction offset adverse effects of the real estate downturn, thus China's elevator production continued to lead the world by climbing 23% YoY to 450,000 units.
At present, China's per capita ownership of elevator in service is 14.8 units / 10,000 persons, which is about 60% of the world's average 23.88 units / 10,000 persons, far from saturated.
As the elevator ownership continues to expand, repair & maintenance, transformation and other service-oriented markets will see rapid growth, and the installation and maintenance revenue will turn into an important source of revenue for Chinese elevator manufacturers in future. Currently, the installation and maintenance revenue percentage of Chinese elevator manufacturers is generally not high, e.g., domestic enterprises basically maintain a maintenance revenue percentage of 3-13%, while in developed countries, the maintenance revenue percentage generally exceeds 50%. Among leading domestic enterprises, Shenyang Brilliant Elevator Co., Ltd. has the highest maintenance revenue percentage, which was up to 12.6% in 2011.
Confronted with the increasingly fierce market competition, via public financing to enhance competitiveness, narrow the gap with foreign capital and expand market share as much as possible has become an inevitable choice for the development of Chinese elevator enterprises.
In 2010-2012, Chinese elevator enterprises ushered in a listing boom. Following the successful listing of Canny Elevator on March 12, 2010, SJEC Corporation entered the Shanghai Stock Exchange with flying colors on January 16, 2012, so will Shenyang Brilliant Elevator and Suzhou Dongnan Elevator, and other private companies also have plans for listing.
Meanwhile, major foreign elevator manufacturers are accelerating the pace of expansion in the Chinese market.
On December 1, 2011, KONE Corporation announced to invest RMB950 million to increase a 40% stake in GiantKONE, thus becoming the largest shareholder by holding 80% of shares.
In April 2011, Schindler acquired a 46% stake in Xuchang XJ Elevator Co., Ltd.,? formally making the latter its joint venture and further increasing its share in China's second- and third-tier elevator market.