The 13th Five-year Strategic Plan of Chinese Foundry Industry

WEI GAO

China Foundry Association

March 15, 2017

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1.  Current situation and main problems

2.  Guiding ideology, development strategy, objectives and main tasks

3.  Relevant measures and policy proposal

Contents

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1.1 Current Situation

Output（

10,000t）

growthrate

（%）

The total casting annual output and growth from 2000 to 2015

14891626

19872242

2442

28093127

33503530

3960

4150 42504450

4620 4560

6.7%9.2%

22.2%

12.8%

8.9%

15.0%

11.3%

7.1%5.4%

12.2%

4.8%

2.4%

4.7%3.8%

-1.3%

-5.0%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

0

500

1000

1500

2000

2500

3000

3500

4000

4500

5000

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

1.1.1 Casting output continues to grow but the growth rate is slowdown

1.1.2 Enterprise’s average scale gradually increased

4

13201777

0

500

1000

1500

2000

2010 2014

averageannualproduction(t)

During the second half of the “12th Five-year Plan”:

•  Companies quantity gradually reduced (about 26,000 at the present）

•  Casting output of the top 4500 scale companies accounted for more than 70% of the total

•  Industry concentration improved

1.1.3 Casting materials structure optimized Thepercentageofduc6leironcas6ngandaluminumcas6ngincreased.

Casting materials structure in China

Produc6onpercentageYearMaterial

2005 2010 2015

Grayiron 50.4 48.0 44.3

Duc6leiron 23.9 25.0 27.6

Cas6ngsteel 13.2 13.4 11.2

Aluminum 7.7 9.6 13.4

1.1.4 Casting quality was improved steadily

1.1.5 The equipment and technical level of foundries has been greatly improved 1.1.6 Raw and auxiliary materials production specialization greatly improved

1.1.7 Domestic foundry equipment manufactures significantly improved

1.1.8 The concept of green foundry and sustainable development has been strengthened

1.1.9 Optimizing the industry structure and layout

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1.2 Main Problems 1.2.1 Foundry industry still has a lot of outdated production capacity

Uneven development between enterprises, a large number of outdated production capacity

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•  Can’t meet the requirement of the Conditions of Foundry Industry Access.

•  Pollutant emissions, energy consumption, material consumption is much higher than the industry average

Morethan10,000foundries

1.2.2 Many fields have excess production capacity.

1.2.3 Casting used in a few key equipment are still not able to meet the industry requirements.

1.2.4 Awareness of quality and brand is not enough.

1.2.5 Inefficient model of growth still exists.

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1.2.6 Foundry standard system can’t meet the demand of market •  Its covering area is limited and is out of sync with the fast development of foundry industry, which can’t meet the market requirement. •  It fails to provide technology support for the research of new-type and medium and high end products and extending industry chain. •  The Standard is not complete and it takes long time to formulate, the incomplete standard and inconformity restrict the industry’s transformation, upgrading and innovation.

1.2.7 Vocational education system can’t meet the industry’s requirement

•  The operation staff’s overall quality and skill level is comparatively at a low level

•  Lack of management personnel and engineering and technical talents

•  Lack of onsite education and training within enterprises

•  The quantity of talents are less and in uneven distribution.

2.1 Guiding Ideology

•  Five new ideas of development -- "innovation, coordination, green, open, sharing"

•  Adhere to the new road of industrialization with Chinese characteristics

•  "Made in China 2025 "- innovation driven, quality first, green development, structural optimization, talent oriented"

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2.2 Development Strategy Quality & Brand

Technology Innovation

Green Foundry

Structural Optimized

Lean Management

Training

2.3 Objectives and Main Tasks

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• Keep low annual growth rate ：3%

• About 55 million t • Output value about RMB700 billion

Casting output

• The number of foundries decreased year by year

• The number of foundries less than 15,000 •  30% foundries（about 4,500 foundries）output will account to 80%+ of the total

Industrial concentra

tion

2.3.1 Improve industrial concentration to achieve the transformation of quality and efficiency

2.3.2 The process of high–end casting and Intelligent foundry equipment

Realize the ability to make key casting to meet the needs of the major equipment in China F  Construc5onmachineryandotherhigh-endhydrauliccas5ngF  Largeenergycas5ngsandrailtransitcas5ngsF  Aerospacecas5ng

Promote the integration of IT application with industrialization to realize smart foundry

F  R&Dforwideformat3Dprintforsandmould(core)andrelatedsupplies

includingrobotapplica5ons F  Digitaldesign,analysisandmanufacturingtechnologyF  Digitalnearnetshapecas5ngtechnologyF  Digitalintelligentfoundry(workshop)

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2.3.3 Casting material structure is optimizing

•  The percentage of ductile iron and vermicular graphite cast iron in cast iron in 2014: 37%, by 2020: 42%

•  The percentage of aluminum and magnesium castings production in all castings in 2014: 13% , by 2020: 20%

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2.3.4 The energy saving and emission reduction will be lifted to a new level

•  The comprehensive energy consumption per ton will be reduced by 10% than 2015

•  The reclamation rate of foundry sands will be greatly increased, the annual reclamation amount will reach to more than 3 million tons. •  Enterprises approved by Foundry Industry Access will meet the requirements of energy saving and emission reduction

2.4 Main tasks

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2.4.1 Advancing the implementation of Foundry Industry Access and the elimination of outdated capacity 2.4.2 Conquering the bottleneck of the manufacturing of high-end key castings 2.4.3 Promoting the R&D and application of advanced foundry technology and equipment 2.4.4 Promoting the quality and brand construction of foundry industry 2.4.5 Advancing the development of innovation-driven system

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2.4.6 Promoting the deep integration of Industrialization and Informatization in foundry industry 2.4.7 Building specialty and smart foundry clusters (industry parks) 2.4.8 Advancing the whole industry to form the low-carbon recycled development mode 2.4.9 Constructing Association Standard System which meets market demand and innovation requirements 2.4.10 Establishing and completing the personnel training system and mechanism at all levels

2.4.11 To promote the development of modern service in foundry industry

•  Focus on the development of related

services

•  Improve the efficiency of resource

allocation

•  Orienting to the transformation and

upgrading of the foundry industry

R&D Logis6cs

IT

Eco-Saving

Inspec6on

Incubator

EC

Consul6ng

Financial

HR

Brand

FoundryCluster

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2.4.12 Promoting international communication and cooperation

•  Accelerating the cooperation on international capacity

and equipment manufacturing

•  Promoting the implementation of “Belt and Road” strategy in foundry industry

•  Advancing various cooperation between Chinese foundry industry and the top

international enterprises in the product R&D and technology, establishing long

term strategic cooperation relationship

•  Improving right-protection awareness in international trade, safeguarding

industry’s safety, protecting proprietary intellectual property rights, reducing

and avoiding international trade conflicts related with castings 17

2.4.13 Advance the culture construction of the foundry industry Opportunity: China is making great efforts to advance the cultural industries

•  Building workmanship spirit •  Constructing foundry industry’s spiritual system •  Establishing the spiritual power and value orientation

Building the system for carrying forward the traditional foundry culture

Establishingfoundryculturalandservicesystems

•  advancing the compiling of Foundry History and the construction of the Foundry Museum of China •  pushing the “going out” of Chinese foundry culture and traditional culture

•  carrying forward the bronze culture •  improve the charm of Chinese art foundry

3.1 National industrial policy proposal •  Closely linking with Foundry Industry Access, revising standard for

energy consumption and environmental protection in foundry industry, establishing elimination mechanism of outdated production capacity；

•  Drafting a concrete plan of the Green Manufacturing Engineering in

foundry industry;

•  Support built key generic technology research institute, Industry Alliance, Collaborative innovation platform in foundry industry;

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3.2 Establish the association standards system to meet the need of market

Perfecttheregula6on Specifica6onprocess Solidfounda6on

•  Regulation of CFA standards

•  “Standards system + ”

•  To built information platform of association standards

and inquiry system

•  To carry out international cooperation

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Foundries+Branch+Foundrycluster+Upstreamanddownstreamindustries

3.3 Set up a reasonable career system, open rising passageway for talent

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�  The major matches with requirements of industry

�  Professional courses matches with industry standards

�  Education matches with production process

�  School certificates matches with professional credentials

�  Training matches with lifelong learning

The Foundry Institute cooperated by National Open University and CFA builds a new model for the personnel training of foundry industry

MetalChina2017

June13-16

Shanghai

Metal China will provide a platform for you to know more about Chinese foundry industry and establish cooperation with Chinese companies as well as the world.

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ThanksforyouraWen6on!

Contact:GaoWeigaowei@foundry.com.cn+8618911227985