China’s Manufacturing Sector Steady and Rising in H1 2026

Value-Added Growth: Value-added of industrial enterprises above a designated size in the manufacturing sector grew by 5.6% year-on-year (YoY) in H1, outpacing total industrial growth by 0.2 percentage points.

Corporate Profitability: From January to June, major industrial enterprises posted total profits of 3.948 trillion yuan, a YoY increase of 18.7%. The operating profit margin reached its highest cumulative monthly level since 2024.

Economic Contribution: The industrial sector contributed over 35% to overall economic growth in H1. Positive growth was recorded in 32 out of 41 major industrial categories, reinforcing its role as an economic stabilizer.

High-End Manufacturing Expansion: Value-added in equipment manufacturing and high-tech manufacturing grew by 9.3% and 13.3% YoY respectively, surpassing total industrial growth by 3.9 and 7.9 percentage points.

Key Product Output: Output for 3D printing equipment, lithium-ion batteries, and industrial robots surged by 48.5%, 39.3%, and 28.0% YoY respectively, reflecting strong capacity release in high-end equipment.

Sub-Sector Dominance: Industrial robot sales accounted for nearly 70% of the global market, with humanoid robot models exceeding half of the world’s total. From January to May, new shipbuilding orders held an 81.2% global market share, maintaining the world’s top spot.

Shipbuilding Industry: Completed shipbuilding output reached 36.5 million deadweight tons (DWT) in H1 (+51.2% YoY), while new orders soared to 121.06 million DWT (+173.1% YoY). All three core indicators hit record highs, with market shares across three main ship types exceeding 80%.

Machinery Industry: Value-added of major machinery enterprises grew by 6.4% YoY, exceeding overall manufacturing growth, fueled by strong momentum in general and specialized equipment sectors.

Smart Equipment: Top-tier enterprises saw orders from pan-semiconductor, new energy battery, and photovoltaic HJT production lines reach 63% of total orders. Domestic flexible cobots reached over 12,000 units shipped for a single model, marking a dividend realization phase for import substitution.

PMI & Sentiment: The Manufacturing Purchasing Managers’ Index (PMI) returned to expansion territory at 50.3% in June. The Production and Business Activities Expectation Index stood at 54.3%, signaling sustained market confidence recovery.

Investment Dynamics: While overall manufacturing investment dipped 1.2% YoY in H1, investment in intellectual property products grew by 9.4% YoY, underscoring intensified R&D commitments.

Export Performance: New energy vehicle exports leaped 1.2-fold YoY in H1, while trade in AI-related products displayed robust growth, maintaining solid foreign trade momentum.