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Market Analysis of Automotive Wiring Harness Industry Chain

If the car engine is the heart of the car, then the car wiring harness is the blood vessel of the car, and the car engine is rotated by the car wiring harness. Car wiring harnesses are hidden in the interior and exterior of the car and are not understood by consumers, but they are crucial to the safety of the entire vehicle and are also directly related to the customer's driving experience. This article will answer the following questions:


1. What are the industrial chain moats of automotive wiring harnesses?


2. What factors drive the development of automotive wiring harnesses?


3. Where will the car wiring harness develop?


Overview of the automotive wiring harness industry: the industry chain has a solid moat


OEMs have extremely strict requirements for qualification certification and assessment of qualified automotive wiring harness suppliers. Once automotive wiring harness manufacturers are included in the qualified supplier directory of OEMs, a relatively stable long-term cooperative relationship will be formed. Qualification barriers form a solid moat for the industrial chain.


The selection criteria for automotive wiring harness manufacturers by auto manufacturers are strict and the cycle is long, and supplier qualification barriers have formed an important industrial chain moat for automotive wiring harness manufacturers. The power platform of a vehicle manufacturer generally has a life cycle of 5-7 years. Therefore, once a vehicle manufacturer has selected a vehicle wiring harness manufacturer, it tends to establish a long-term and stable cooperative relationship with it. If a vehicle wiring harness manufacturer wants to enter the parts supporting system of the vehicle manufacturer, it must first pass the IATF16949 quality management system standard certification formulated by the International Automobile Working Group, and secondly, it must meet the requirements of the vehicle manufacturer in product quality, synchronous development, logistics transportation, management Special standards and requirements for levels, cost control, financial status, etc. Before the product enters mass production, it is also necessary to perform strict product quality advance planning (APQP) and production part approval procedure (PPAP), and after a long period of product installation test assessment, the product can only be mass-produced and supplied after certification. The whole process generally takes 1-2 years. This means that automotive wiring harness manufacturers that have newly entered the industry face high barriers to supplier qualifications in terms of market expansion.


With the rapid development of the global automobile industry, the R&D and production cycles of new vehicles are shortened accordingly. Therefore, OEMs require automotive wiring harness manufacturers to speed up product R&D and design, and have the ability to develop synchronously or even in advance, and also propose the automation capabilities of automotive wiring harness manufacturers. In order to meet the requirements, the technical barriers of the industry are relatively high.


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The overall technical barriers for automotive wiring harnesses are relatively high, and it is difficult for new entrants to compete with well-known manufacturers. The high technical barriers form a solid moat for the industry chain. As the main body of the car circuit network, the automotive wiring harness must ensure the transmission of electrical signals on the one hand, and the reliability of the connection circuit on the other hand, and has higher requirements in product research and development, production process technology, and quality control. With the rapid development of new energy vehicles, new energy vehicles have also put forward higher requirements on the mechanical strength, insulation protection and electromagnetic compatibility of automotive wiring harness products.


The demand of the automobile consumer market is evolving towards diversification, personalization and fashion, and the replacement cycle of automobile models is gradually shortening. Automotive wiring harness manufacturers speed up product development and design, and have the ability to develop synchronously or even in advance.


Automotive wiring harness is still a labor-intensive industry


With the increase in labor costs and the continuous pursuit of product quality by automobile manufacturers, the automotive wiring harness industry has also put forward more stringent requirements for the automation level of design, production and logistics. At this stage, the manufacturing and assembly of vehicle wiring harnesses is still a labor-intensive industry. The number of wiring harness materials for the entire vehicle is large, resulting in complex and cumbersome manufacturing processes, relatively low degree of automation, and many quality control points in the manufacturing process. But on the one hand, China's demographic dividend is gradually disappearing. On the other hand, electrification and intelligence promote the development of the overall automobile industry to a higher level, and automobile manufacturers put forward higher requirements for the quality and automation capabilities of parts and components. Considering these two aspects, the automotive wiring harness industry must speed up the transformation pace, improve the level of automation and vehicle supporting capabilities. The new entrants to the industry are small in scale, with weak synchronous R&D capabilities and automation capabilities. The quality and reliability of products still need to be improved, and the technical barriers are relatively high.


Calculation of the market size of automotive wiring harnesses


The size of the automotive wiring harness market is mainly determined by the sales volume of automobiles and the value of a single vehicle. From 2016 to 2026, the sales of automobiles in China will show an upward trend, and the value of a single vehicle of the automotive wiring harness will also increase at a steady growth rate. The market size will reach 17.8 billion yuan.


Drivers of automotive wiring harnesses: The trend of electrification drives the development of high-voltage wiring harnesses in the new energy supply chain


Under the background of carbon neutrality, the world is actively responding to climate change. Major countries have promoted green and low-carbon economic transformation and put forward the goal of leading the carbon transformation in the automobile industry. The electrification transformation will be completed within the year, and new energy vehicles will further develop.


Major countries in the world are actively promoting green and low-carbon economic transformation, and the penetration rate of new energy vehicles has increased rapidly. At this stage and in the future, carbon emissions are a hot topic that cannot be avoided in economic development and automobile transformation. In the context of the global active response to climate change, countries have proposed zero-carbon transformation goals for the automotive industry. For example, Norway proposes to electrify all passenger cars and light trucks sold in 2025, the Chinese government proposes that the penetration rate of new energy vehicles will reach 20% in 2025, and the European New Deal proposes to reduce carbon dioxide emissions from automobiles by 55% in 2030 compared with 2021, and new car emissions in 2035. zero. Support from major countries drives the development of global vehicle electrification, and sales of new energy vehicles are expected to grow further.


Driven by the policies of various countries, more and more car companies have proposed electrification goals, aiming to complete the electrification transformation within a few years. At this stage, carbon reduction and decarbonization have become an important driving force for the transformation of traditional car companies to new energy. Big car companies have promised to stop selling fuel vehicles by 2040, and only sell zero-emission new energy vehicles by then, which will further promote the development of new energy vehicles around the world.


High-voltage wiring harness is a new pure incremental market for new energy vehicles. The development of automotive electrification will greatly promote the development of high-voltage wiring harnesses. The value of wiring harness bicycles has also increased significantly.


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