Taking January 1, 2008 as a turning point, many air compressor enterprises in China have used up the orders of 2007. Meanwhile, the new Labor Contract Law was officially implemented on January 1, and the labor cost (the wages of workers in the compressor industry increased by 20% in 2008 compared with the same period in 2005), land (the price of land increased by 100% in 2008 compared with the same period in 2005), raw materials (the prices of raw materials increased by 20% in 2008 compared with the same period in 2005), profits (profits decreased by 30% in 2008 compared with the same period in 2005) and other cost pressures are still rising. The air compressor industry base is once again facing a choice: to close or not? To relocate inland, relocate overseas, or stay put? That is the question. Due to the above reasons, the production costs of many air compressor companies in China have risen. In the future, manufacturing costs may rise further, and related enterprises will enter an accelerated period of "survival of the fittest". During this process, some costs may need to be paid, and the bankruptcy of some enterprises is inevitable. In addition, the new Labor Contract Law implemented on January 1, 2008, plus the "merger of two taxes", all these may affect the cost of Chinese-made air compressors in the future. At the same time, affected by the appreciation of RMB, how much the enterprises can bear depends on their own adjustment and response capabilities.