In recent years, driven by the relevant national policies, the development of domestic plastic pipe industry shows a strong growth trend, becoming the main force of domestic plastic processing industry. According to the statistics of China Plastics Processing Industry Association, the annual growth rate of China plastics pipe market is up to 15%, ranking the first in the world.

Although there are a large number of plastic pipe production enterprises in China, most of them have an annual production capacity of less than 5000 tons, while foreign plastic pipe production enterprises have an annual production capacity of more than 20000 tons, and the production capacity ratio of pipes and pipe fittings is unreasonable.

At present, the production capacity ratio of pipe and pipe fittings is about 15:1, which is far from the normal application ratio of 8:1, and the variety of pipe fittings is also small. In addition, plastic pipes are mainly used in communication, construction, gas supply, water supply, drainage and other infrastructure construction fields. Due to the long implementation cycle of the project, the payment settlement time is long, and the occupation of working capital is large, which requires the production enterprises to have strong funds.

Compared with developed countries, the technical level of China's plastic pipe industry is weaker, and there is still a gap between scientific research force, funding and demand. Especially in the processing equipment of plastic pipe, the quality of mould, the degree of automation, the continuity of production, the quality of products and the amount of extrusion, there is still a big gap compared with developed countries, and the international market competitiveness is not strong.

With the huge market capacity and low entry threshold, plastic pipe has been a hot investment project in the past few years. At that time, due to blind investment and overcapacity of low-end products, its malignant effect began to appear.

Domestic plastic pipe production enterprises have entered the era of low profit. In order to win sustainable and stable development space, enterprises should establish brand image as soon as possible. Large enterprises can digest the rising cost caused by the rising price of raw materials by optimizing the production management capacity. For small and medium-sized enterprises, they can reduce the production cost by purchasing raw materials centrally.

Taking the PVC pipe enterprises with large market share as an example, the products are still concentrated on urban and rural water supply and drainage pipes and pipe fittings, rainwater drainage pipes and pipe fittings, leading to the saturation of market capacity, increasing the intensity of competition in the product field.

In order to compete for the market, some enterprises adopt the price driven strategy, especially some small enterprises dump their products at low prices. The price war becomes more and more fierce and they are in the situation of vicious price competition.

The original competitive advantage of PVC pipe companies with low technology content and single variety of products is that the price is lower than that of polyethylene and polypropylene pipes, while the rise of raw materials makes them in a passive situation, providing an entrance for competitors.

In recent years, in addition to the original gas pipe and heating pipe, the emerging polyethylene pipe market has also entered the urban and rural water supply and drainage pipe and pipe fitting market. Moreover, the price rise of polyethylene resin is smaller than that of PVC, the pressure of production cost is not great, and there is no lead ban problem, which adds competitive advantage. It can be said that PVC pipe enterprises are in a situation of internal and external troubles.