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In the next four years, the cable industry will be "double happiness"

Date: 2018-03-08
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In the next four years, the cable industry will be "double happiness"

In recent years, with the rise of raw materials, fierce competition, and the intrusion of external cable giants, it has brought heavy pressure to China's wire and cable industry. Last year, due to internal and external factors such as the international financial crisis and the slowdown in China's GDP growth, China's wire and cable industry was also suffering from a general shortage of operating capacity and overcapacity. Therefore, in the next few years, China's wire and cable industry will be a fish on the shore or a fishy fish. This is worth all the cable industry people think and study.

From China Industry Research Network, “Analysis Report on the Macro Investment Environment and Industry Development Trends of Wire and Cable Industry 2012-2016” can find that during the “12th Five-Year Plan” period, locomotive cables, communication and signal cables will usher in vitality. The reason is that the speed of China’s railway construction will increase, and the demand for the above two types of cables will be very large. According to relevant experts' forecast, the average annual demand for locomotive cables will reach 160,000-200,000 kilometers, while the demand for communication and signal cables will reach 70,000-100,000 kilometers. In addition, the implementation of urban rail transit construction has also won a huge market for China's wire and cable industry. It is predicted that the annual demand for vehicle cables will be about 30,000 kilometers, while the annual demand for general-purpose signal cables for traffic is about 20,000 kilometers.

Through the data, it is not difficult to find that in the next four years, the construction of urban rail transit will become a crucial business growth point for the Chinese wire and cable industry, and it can be called the last straw.

At present, the output value of the wire and cable industry in China has exceeded 1 trillion, accounting for more than 25% of the global wire and cable market share, becoming the world’s number one producer nation over the United States. However, issues such as serious homogenization competition in the industry and fierce competition at low prices are also objective. If we take advantage of the opportunity brought by the construction of rail transit and strive to improve our own hardware and software capabilities, which will lead to a successful transition, and will no longer be tumbled in mid-to-low-end products, it will undoubtedly be a “double happiness event”.

The large-scale advancement of rail transit construction is not an empty talk to help companies revisit the transformation process, let alone nonsense. The most important reason is that, for tunnels and other complex terrain and special conditions, rail transit construction will give wire and cable production. Enterprises throw a series of problems and put forward higher requirements and standards. A competent and large-scale wire and cable manufacturing enterprise should take this opportunity to strive to develop new technologies and materials in order to meet the requirements of rail transit construction. It is also through the development of new technologies and new materials that the truly powerful wire and cable manufacturing enterprises and those workshop-type production enterprises are not only able to occupy a huge market brought about by the construction of rail transportation, but can also get rid of the low profit from it. And the fierce competition in the low-end product competition.

Although the prospects are considerable, reality is always cruel. Due to the limited number of companies that can produce high-precision products in China, it is difficult to capture the huge market brought by rail transit construction. In order to win customers, these high-precision wire and cable manufacturers have to urgently purchase equipment, and at the same time recruit people on a large scale, resulting in increased fixed costs and tightening the capital chain of the company. Instead, they impose certain restrictions on follow-up research and development capabilities.

In view of this situation, in order to improve the technical level of wire and cable manufacturing enterprises, it is difficult to support a single enterprise, and it is necessary to make more companies participate in the joint research and development and production. In addition, domestic wire and cable manufacturers, especially large-scale enterprises, should make reasonable use of their strong financial strength to buy technology and buy talents in order to improve their own development capabilities. Finally, since wire and cable are of the utmost importance in the construction of rail transit, they must not use their own methods of shoddy and fake counterfeit brands to achieve market share, but should strictly follow national standards. , strive to improve product quality.

China's wire and cable industry has experienced serious fake and shoddy products for a long time, non-standard products continue to suffer from repeated bans, low value-added products, serious product homogeneity, low barriers to entry, fierce competition at low prices, slow return payments, lack of well-known brands, and extensive Problems such as development have still not been reasonably resolved until today. Therefore, the large-scale advancement of rail transit construction will bring a huge cake to China's wire and cable industry, and how domestic wire and cable manufacturers can eat it is also a very worrying issue. The phenomenon that the author does not want to see is that the huge domestic market cake once again falls into the giant cable oligopoly.

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