Mechanical Components Market: Current Development Status and Future Trends

Driven by the dual forces of global manufacturing recovery and industrial upgrading, the mechanical components market—acting as the "muscles" and "blood vessels" that sustain the operation of the industrial system—has consistently demonstrated remarkable resilience in recent years, emerging as a critical and indispensable link in the global industrial chain. In terms of market size, the global mechanical components market successfully surpassed US$1.02 trillion in 2024, marking a year-on-year growth of 6.2%. This robust expansion is not only fueled by the technological upgrade demands in traditional manufacturing hubs like Europe and North America but also closely tied to the accelerated industrialization process in emerging markets, particularly China. Behind this impressive growth trajectory, Chinese state-owned enterprises have emerged as the driving force propelling market expansion, thanks to their deep-rooted technological expertise, well-established production systems, and unparalleled capacity for resource integration.

Specific data reveals that in 2024, China's state-owned enterprises contributed 38% of the global growth in the mechanical components market, while capturing an impressive 48% share of the domestic market. Particularly in the booming sector of construction machinery parts, these state-owned firms have solidified their dominance, holding over 60% of the market thanks to their reliable product quality, consistent production capacity, and robust after-sales service networks. Take LiuGong, a leading state-owned enterprise in China’s construction machinery parts industry, as an example. In 2024, its parts business generated revenue of 8.6 billion yuan, accounting for 18% of the company’s total revenue. Notably, overseas sales exceeded 2.2 billion yuan, representing a year-on-year growth of 25%. To better serve international markets, LiuGong has established 12 regional parts distribution centers and more than 20 after-sales service stations across key regions with strong infrastructure demand, including Indonesia and Vietnam in Southeast Asia, as well as Saudi Arabia and the UAE in the Middle East. As a result, parts delivery times have been reduced to within 48 hours, achieving customer satisfaction rates as high as 92%. Thanks to this strategic expansion, LiuGong now maintains stable market shares of 15% and 12% in the aforementioned regions, respectively. The company has become a critical enabler of smooth operations for major local infrastructure projects—such as Indonesia’s new capital city initiative and Saudi Arabia’s Future City project. Moreover, certain LiuGong parts products have even penetrated niche markets in neighboring countries through partnerships with local distributors.

From a segment perspective, Chinese state-owned enterprises have established comprehensive competitiveness across key areas of mechanical components, demonstrating strong market influence in core categories such as bearings, gears, and hydraulic parts. In the global bearing market, which reached a size of US$62 billion in 2024, Chinese state-owned firms captured a 29% market share with revenues totaling US$18 billion. Among them, Luoyang LYC Bearing—a leading domestic state-owned enterprise in the high-end bearing sector—has been deeply engaged in cutting-edge applications like wind power, heavy-duty machine tools, and rail transportation. LYC Bearing has developed main shaft bearings specifically tailored for large-scale wind turbines exceeding 10 MW in capacity. These bearings have not only passed rigorous international certifications, including Germany’s GL and the U.S.’s ABS, but also address critical challenges faced by conventional bearings—such as increased wear and reduced lifespan under harsh conditions like strong winds and extreme cold. As a result, LYC Bearing now holds a commanding 35% share in China’s premium wind turbine bearing market, effectively breaking the long-standing dominance previously held by international brands like Sweden’s SKF and Germany’s Schaeffler. Meanwhile, LiuGong, a major purchaser of bearings, continues to accelerate its efforts toward domestically produced alternatives. In 2024, the company significantly boosted its procurement of domestically made bearings—from 30% in 2020 to 55% today. Notably, the specialized excavator bearings custom-designed in collaboration with China Axis Research Technology (a state-owned enterprise) have undergone substantial improvements. By optimizing material formulations and refining manufacturing processes, the failure rate of these bearings has dropped dramatically—from 1.8% in 2020 to just 0.6%. Consequently, the replacement cycle for each excavator’s bearing has been extended from 8,000 hours to 12,000 hours, significantly cutting down on customers’ operational and maintenance costs.

In the gear market, the global scale reached 142 billion yuan in 2024, with Chinese state-owned enterprises emerging as a significant player, accounting for 34% of the market share. Shaanxi Fast Gear Co., Ltd. (a state-owned enterprise), serving as an industry benchmark, has particularly excelled in the heavy-duty truck gear and construction machinery gear segments, capturing 45% and 32% of the domestic market share, respectively. The company’s newly developed 16-speed heavy-duty truck transmission gears boast a transmission efficiency of 98%, surpassing the industry average by 2 percentage points—and can help each vehicle save up to 1.2 tons of fuel annually. These gears have already been integrated into mainstream automotive brands such as China National Heavy Duty Truck Group and Dongfeng Commercial Vehicle. Meanwhile, LiuGong has closely followed the trend toward new-energy construction machinery. In 2024, the company’s procurement volume of gears for new-energy equipment surged by 80% year-on-year. Notably, LiuGong sourced its new-energy wheel loader drive gears from Shanghai Energy Equipment Co., Ltd., a subsidiary of China Gezhouba Group—another state-owned enterprise. These cutting-edge gears are crafted from a novel low-carbon alloy material, reducing their weight by 12% while simultaneously boosting transmission efficiency to 96.5%, a remarkable 3-percentage-point improvement over conventional gears. As a result, LiuGong’s 856H new-energy wheel loader equipped with these advanced gears now delivers a 15% increase in续航能力, perfectly meeting the demands of extended operations in enclosed environments like ports and mining areas.

As the "heart" component of construction machinery, hydraulic parts reached a global market size of 128 billion yuan in 2024, with Chinese state-owned enterprises accounting for 30% of this market. The collaboration between LiuGong and Guangxi Yuchai Machinery Group Co., Ltd.—a state-owned enterprise—stands as a prime example of breakthroughs in domestically produced hydraulic components. Together, they jointly developed an excavator main pump after three years of intensive research, successfully overcoming key technical challenges such as high-pressure sealing and precise flow control. By 2024, the pump had been integrated into 12,000 units, representing 45% of LiuGong's total excavator output. Not only is this main pump 30% more cost-effective than imported counterparts, but its failure rate has also dropped significantly—from 2.5% in 2020 to just 0.8%. As a result, it has successfully replaced similar products from Japanese manufacturer Kawasaki and German company Bosch in China's mid-sized excavator hydraulic component market. Moreover, in the realm of intelligent hydraulic systems, LiuGong introduced its electro-hydraulic fusion control system in 2024, which has already been adopted by 5,000 loaders. This cutting-edge system continuously collects real-time equipment operation data and dynamically adjusts hydraulic parameters, boosting operational efficiency by 15% while reducing fuel consumption by 12%. Today, LiuGong’s intelligent hydraulic system holds a 20% share in China’s domestic smart hydraulic systems market.

Technological innovation has always been the core driving force behind China's state-owned enterprises as they lead the upgrade of the mechanical components industry. In the three key areas of intelligent manufacturing, green production, and lightweight design, these enterprises have achieved a series of groundbreaking accomplishments. In the realm of intelligent manufacturing, in addition to LiuGong’s smart bearings, LYC Bearing from Luoyang has developed an innovative large-scale bearing equipped with built-in sensors for temperature, vibration, and rotational speed. This advanced technology enables 24-hour real-time monitoring via an industrial internet platform, delivering data analysis accuracy as high as 98%. Currently, these smart bearings are already integrated into more than 20 wind farms across China, helping customers cut operational and maintenance costs by up to 25%. In the field of green manufacturing, LiuGong has spearheaded the widespread adoption of eco-friendly processes throughout its component production stages. For instance, the company uses biodegradable cutting fluids that can be reused for up to 12 months, significantly reducing waste liquid emissions by 80% compared to conventional cutting fluids. This approach not only slashes annual treatment costs by 250 million yuan but also helps LiuGong achieve a remarkable 80% reduction in carbon dioxide emissions each year—equivalent to taking 12,000 cars off the road. Meanwhile, LYC Bearing from Luoyang has taken sustainability a step further by increasing the proportion of recycled steel used in its products to 30% of total raw materials. By refining its smelting processes, the company has boosted steel utilization efficiency from 85% to 92%, resulting in an annual reduction of 3,000 tons of solid waste. Finally, in the area of lightweight technology, LiuGong has made particularly impressive strides. The company has developed an aluminum-alloy loader bucket that combines aerospace-grade aluminum with an integrated molding process, slashing the weight by 30% compared to traditional steel buckets—while simultaneously boosting strength by 15%. By 2024, after equipping 3,000 loaders with this innovative design, the overall machine weight was reduced by 5%, leading to lower transportation costs and a significant 8% decrease in fuel consumption. As a result, each machine now saves its operators an impressive 15,000 yuan annually in fuel expenses.

At the policy level, dual support from the national and local governments has provided solid backing for state-owned enterprises (SOEs) to break through technological bottlenecks and expand their market opportunities. The "Made in China 2025" initiative explicitly identifies high-end mechanical components as a key area for development, offering SOEs participating in cutting-edge R&D projects—such as advanced bearings and intelligent hydraulic systems—up to 30% in research and development subsidies. Meanwhile, local governments have also rolled out complementary policies: for instance, Guangxi provides tax breaks for LiuGong’s component R&D projects, while Jiangsu offers export tax rebates to help LYC Bearings of Luoyang expand into overseas markets. Moreover, driven by the Belt and Road Initiative, SOEs have gained even more opportunities to engage in international collaborations. For example, LiuGong has leveraged tariff preferences under the China-ASEAN Free Trade Area, reducing export tariffs on components from 10% to 0, resulting in a 35% year-on-year increase in component exports to ASEAN in 2024.

From the perspective of the industry's competitive landscape, the global mechanical components market currently exhibits a "three-way dominance" pattern. European companies still hold an edge in high-end components—such as precision bearings and aerospace gears—while North American firms demonstrate strong competitiveness in large-scale construction machinery parts. Meanwhile, Chinese state-owned enterprises are rapidly gaining momentum in the mid-to-high-end market, steadily transitioning from "following closely behind" to "running side by side." In 2024, among the world's top ten mechanical components companies, three spots were already occupied by Chinese state-owned enterprises: LiuGong, Luoyang LYC Bearing, and Shaanxi Fast Gear. Notably, Shaanxi Fast Gear has captured 12% of the global heavy-duty gear market share, placing it firmly within the global top three.

Looking ahead, as global manufacturing undergoes a transformation toward intelligence and sustainability, the mechanical components market is poised to unlock even greater growth potential. By 2032, the global market size is expected to reach US$1.58 trillion, with Chinese state-owned enterprises likely increasing their global market share from 22% to 28%. Liugong has already outlined a clear development strategy: by 2030, the company plans to boost the procurement ratio of domestically produced high-end bearings to 80%, achieving 100% localization of hydraulic components. At the same time, Liugong aims to double its market share of accessories in Southeast Asia and the Middle East, while raising its overseas revenue contribution to 30%. However, the industry still faces significant challenges. On one hand, fluctuations in raw material prices—such as steel and copper—can range between 10% and 15% annually, putting pressure on state-owned enterprises' cost-control efforts. On the other hand, international brands continue to maintain robust technological barriers in the高端配件领域; for instance, in the aerospace sector, where precision bearings are critical, domestic state-owned firms currently hold only a 5% market share. Moving forward, state-owned enterprises must further optimize their supply chain strategies. This includes establishing strategic reserves of key raw materials and forging long-term agreements with upstream suppliers to ensure cost stability. At the same time, they need to ramp up investment in core technology R&D. By 2030, companies like Liugong and Luoyang LYC Bearing aim to increase their R&D spending to 8%–10% of revenue, striving to achieve breakthroughs in high-end component technologies and solidifying their competitive edge in the global market.