China has maintained the status of the largest export country of machinery products in the world in 2013，and its international market share has further increased. However，other indicators of competitiveness which reflect the balance of trade and the comparative advantage depicted that there is still a large gap compared with that of Germany and Japan. In the international production networks based on the industry chain，China has become the largest processing and assembly base，which causes that its assembly advantage in mechanical parts is significantly higher than its production advantage. It has stepped into a key stage from quantitative to qualitative changing in enhancing the competitiveness of China machinery industry. This transformation and upgrading is not only related to the status in international division of labor，but also influenced by its domestic institutions and government policies，and the rapid evolution of new technologies and new methods of production around the world will also considerably influence this process.