In the ever-evolving world of electric tools, innovation and technological advancement are at the forefront of industry growth. China has witnessed remarkable development in this sector, driven by both rapid domestic progress and extensive international collaboration. According to Luo Baihui, Chief Information Officer at Jinmoji Electric Power Co., technology plays a vital role in propelling the electric tool industry forward. As a high-tech sector, the power tool industry requires continuous investment in advanced technologies to improve efficiency, quality, and competitiveness.
The global power tool market is typically divided into three tiers: industrial, professional, and DIY. Industrial-grade tools are designed for precision-driven environments such as aerospace and heavy manufacturing, where reliability and performance are critical. These tools are characterized by high technical standards, higher profit margins, and a more limited but specialized market. On the other hand, DIY tools cater to everyday home use, offering simplicity, affordability, and ease of operation. However, they come with lower technical complexity and thinner profit margins.
Currently, most Chinese power tool manufacturers focus on producing DIY-level products, which leads to intense price-based competition and a crowded, low-end market. In contrast, professional-grade tools offer greater value, with features like higher power, longer motor life, and superior durability. These tools serve industries such as construction, automotive, and shipbuilding, where performance and reliability are essential. Despite their advantages, professional-grade tools remain underdeveloped in China, with few companies capable of producing a full range of such products.
Foreign brands like Bosch (Germany), Makita (Japan), and Hitachi (Japan) have long dominated the Chinese power tool market. However, recent trends show a gradual shift as domestic brands gain traction. Ruiqi, for example, has emerged as a strong contender, rapidly increasing its market share and challenging established international names. In just seven years since its inception, Ruiqi has become one of the top four players in the domestic market, showing potential to catch up with industry giants that have decades of history.
The current state of the Chinese power tool industry reflects a fragmented landscape, with most companies focused on low-end products. There's a clear need for consolidation, as industry leaders are expected to drive standardization and innovation. As the market evolves, domestic brands will likely continue to replace foreign ones, reshaping the competitive landscape. Industry integration, led by key players, is crucial for sustainable growth.
Ruiqi, as the only publicly listed company primarily engaged in power tools, is well-positioned to play a pivotal role in this transformation. With access to capital and strategic opportunities, it can lead the reorganization and modernization of China’s power tool industry, paving the way for a more competitive and innovative future.
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