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Industry statistics show that in the next few years, the development speed of China's wire and cable industry will be higher than the development speed of the national economy, which is expected to reach more than 10%. In particular, power wires and cables can grow at an average annual rate of 15%.
Advantages: It has become the world's largest cable producer
In recent years, the construction of power grids has accelerated and UHV projects have been put into construction one after another, creating a huge market for the wire and cable industry. According to statistics, the industry has grown at an average annual rate of more than 15% in the past 15 years. At present, the total industrial output value of the industry has exceeded 400 billion yuan, becoming the second largest industry in China after the automobile industry.
China's position as a global peer is very important. The total output value of wire and cable has surpassed that of the United States, becoming the world's largest wire and cable producer. From the perspective of the world, Europe, Japan and the United States have already carried out strategic mergers and acquisitions. The product series was reorganized and the target market was repositioned to form a large-scale or specialized production. It is characterized by high industrial concentration, and the total sales revenue of the top ten enterprises account for more than two-thirds of the market in the country or region. A clear trend is that the world's wire and cable production focus continues to shift to Asia, driving the rapid development of industries in China, Vietnam, the Philippines and the Middle East.
From a holistic perspective, the industry has formed huge production capacity through a large number of technology introduction, digestion and absorption, and independent research and development. The cable materials and cable equipment manufacturing industries that have been matched with it have also formed a relatively complete supporting system. Large enterprises have obvious advantages in market competitiveness and have strong profitability. Small and medium-sized enterprises have better operational capabilities.
At present, the market-oriented operation mechanism of the industry has been significantly enhanced, and the private economy has developed rapidly, which has become the basic force for economic growth in the industry. In particular, the wire and cable manufacturing industry in coastal economically developed areas has obvious advantages, and regional differences have further expanded. In terms of assets, the state-owned economy only accounts for 15%, the three-funded enterprises account for nearly 25%, and the private economy has more than 60%. Most of the top ten companies in the wire and cable industry are privately owned. East China has become the most important manufacturing area for the wire and cable industry, accounting for 60% of the country's assets and output value of 60% of sales, and won 70% of the industry's profit.
Weakness: low-end surplus high-end vacancies
In the rapid development, several major problems in the industry have become the embarrassment of progress.
There is a surplus of low-end products, and high-end products are in short supply. At present, there are about tens of thousands of companies in the cable industry. Most of them are small in scale, and there are only more than 50 companies that can really win the national major projects. The weak influence of industry brands has caused disorderly competition in the wire and cable industry.
The phenomenon of repeated investment in the industry is outstanding and the production capacity is excessive. For example, when urban and rural power grids are being rebuilt, many enterprises have embraced the production of overhead conductors and cross-linked power cables. When attaching importance to the development of high-tech, many enterprises have invested in the production of high-voltage cables and fiber-optic cables. In recent years, many enterprises have invested in the production of automotive wires. In particular, foreign capital has entered the domestic high-voltage cable, optical cable and special cable market, making the competition more intense.
Market standardization is not enough, and local protection is still serious. As one of the main basic industries in China, wire and cable have not reached a certain height in terms of market regulation or the degree of government attention. From a national perspective, the current unified market has basically taken shape, but the invisible threshold between localities has not been broken, and local protectionism is still serious. Some local governments insist on using local products. Some regulatory agencies only look at foreign companies and do not check local companies. These acts are called legal inspections, which are closed protection, which leads to products that cannot be circulated according to market rules and hinder the unified and standardized development of the market.
The prices of raw materials are high and the quality of products varies greatly. The cable is a “lightweight and light†industry, the main raw materials are copper and aluminum.
With the rising prices of copper and aluminum materials, coupled with rising energy and transportation costs, the cost of enterprises has further increased, and the gross profit margin of the industry has declined. This has led some companies to cut corners, or to produce so-called "enterprise standard" products for different customers, so that strict control of production according to mandatory national standards will be produced according to the so-called "tailor-made" safety assurance enterprise standards. Quality risks increase and unfair competition intensifies.
The price discourse power is weak and the market order is chaotic. Most of the cable industry customers are large national projects or state monopoly industries, such as electricity, communications, and railways. Cable companies are unable to engage in a fair dialogue with the strong buyer market. Some companies not only fail to receive advance payments, but also pay premiums to customers. At present, the bidding mechanism is very confusing, and most of them adopt the “lowest price†standard, which results in the product quality not being guaranteed.
Basic research and applied research are not focused enough and lack core competitiveness. Although "takenism" has made wire and cable companies have a better set of equipment, it has not really formed core competitiveness. The enterprise-oriented technological innovation consciousness and system construction lag behind the pace of economic development, which makes the wire and cable sector lack independent intellectual property rights. The key technologies are often subject to people, which seriously restricts the development of high-end technology and high-end products. According to statistics, at present, only 30% of cable products in China reach the level acceptable and competitive in the international market.
Trend: Promote better and faster development
Looking forward to the future, the development prospects of the cable industry are getting better. To this end, the majority of enterprises must actively adjust their thinking, determine development strategies, and promote better and faster development of the industry.
First, accelerate the integration of resources, actively promote the reform of industry and enterprise structure through macro-policy guidance, and promote the optimization of industrial organization structure. Actively set up large enterprise groups and promote the specialized production of small and medium-sized enterprises, and form a large-scale and specialized production system in the industry.
Second, play the role of associations in the development of the industry and build a bridge between enterprises and the government. At the same time, it will play a better role in maintaining the overall interests of the industry and regulating the market order of the industry. On the basis of continuously increasing the intensity of product quality supervision and inspection, a unified, standardized, transparent and open market will be formed throughout the country.
Third, actively promote the brand strategy, and promote the overall level of the industry by integrating superior resources. It is necessary to rely on science and technology, take enterprises as the main body, enhance independent research and development capabilities, vigorously develop new products and promote product upgrading. Advocate industry backbone enterprises to cooperate and jointly carry out basic research work and product reliability research, so that the level of product design, manufacturing and operation is gradually improved.
Fourth, enterprises should increase the intensity of technological transformation, start from the basic production process, actively adopt high-quality and efficient process equipment, and eliminate outdated equipment with low efficiency, high consumption and pollution to the environment. Emphasis on resource-saving product technology, production technology, enhance sustainable development capabilities, and enhance online automatic testing capabilities.
Fifth, vigorously promote the application of environmentally friendly production technology and actively develop environmentally friendly wire and cable products. At the same time, efforts will be made to improve the management level of enterprises, actively promote institutionalized management, refined management and market-oriented operations, comprehensively improve the overall operational efficiency of enterprises, and promote the transformation of the industry to achieve industrial growth. 
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