In recent years, China's high economic growth has driven strong demand for the machinery manufacturing industries. The rapid development of a large number of downstream industries, including engineering machinery, farming machinery and traffic engineering, contributed to the development of the China engine manufacturing market. Total industry revenue has been increasing at an annualized rate of 14.2% in the past five years to $29.8 billion in 2013.
Engine manufacturers experienced slower growth in 2008 and 2009 due to lower exports and downstream demand, particularly from China's marine and boat manufacturing industries, before recovering in 2010.
There are 715 enterprises operating in this industry, employing over 203,500 workers, with a payroll of approximately $1.7 billion. Industry profitability began decreasing in 2008 and is expected to account for 7.5% of industry revenue in 2013. The main reasons behind the fall include the export decline in 2009, the appreciation of the Chinese yuan, rising raw material prices, stricter government requirements, and the long payback period for product research and development.
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