Due to the limitations of the global economic situation, the European wire and cable industry is currently in a stagnant or sluggish situation, while the Chinese wire and cable industry is developing rapidly with a new look, and the degree of marketization of the industry is constantly improving. In particular, we see that the pattern of domestic wire and cable industry is constantly changing, the process of transformation and upgrading is accelerating, and mergers and acquisitions are frequent, which means that China's wire and cable industry is changing to intensive, and also means that with the acceleration of the process of survival of the fittest, China's wire and cable industry will change from pursuing quantitative change to pursuing qualitative change.
Obviously, the development of China's wire and cable industry has been rapid in recent years. The main performance is that as early as around 2011, the output value of more than one trillion yuan has surpassed the United States and become the world leader. However, the side effects of excessive pursuit of output value also appear, which are mainly manifested in low concentration and weak core competitiveness, resulting in the "big but not strong" situation of China's wire and cable industry, the proliferation of uncompetitive manufacturers such as small and medium-sized enterprises (including small workshop enterprises), serious duplication of construction, low price competition in the middle and low end markets, overcapacity in the middle and low end markets, etc.
To this end, from the second half of last year to this year, we saw that China's wire and cable industry is quietly changing. Through a series of measures such as transformation and upgrading, and constantly improving product quality, we have continuously improved our core competitiveness and moved forward to the middle and high-end market with high profits. This is undoubtedly a transformation from quantitative change to qualitative change, and it is also a major improvement to make China's wire and cable industry "stronger".
From a global perspective, looking at the wire and cable industry, we can clearly find several characteristics. First, the developed wire and cable manufacturing industry is still concentrated in Europe, such as Germany, France, Italy, Spain and other countries. In addition, North America such as the United States and East Asia, North Asia such as Japan, South Korea, Taiwan, China, China. The economic development and industrialization process of these regions and countries have promoted the formation of the international cable industry pattern, and through strategic mergers and restructuring, the cable giants in Europe, the United States, Japan and other countries have formed transnational and trans-regional wire and cable production scale or specialization based on their advantages in capital, technology and talent. The total sales revenue of the top ten enterprises accounts for more than two thirds of the national or regional market, Industry concentration is high.
In recent years, with the continuous economic growth of some emerging countries in Asia, the world wire and cable pattern has also been changing. It is obvious that the focus of world cable production has been shifting to Asia, and has driven the rapid development of cable industry in China, Vietnam, the Philippines and other countries. At the same time, due to the establishment of the euro zone, the initial cost of wire and cable manufacturing in Eastern Europe has declined, and the industry has also grown rapidly. However, the wire and cable industries in developed countries such as Europe and the United States are almost stagnant. According to relevant figures, the market share in Asia has exceeded half of the global market.
However, as Europe and other countries still hold the core technology, most of the high-end markets in the world, which are also markets with considerable profit margins, are controlled by them. Therefore, we find that despite the huge output value of China's wire and cable industry, several large companies such as Nexan and General Cable still occupy the main position in the global cable industry, which also reflects the low concentration of China's wire and cable industry and the lack of brand and competitiveness.
According to statistics, the concentration of the global wire and cable industry has become increasingly obvious. In 2012, the world's top five cable manufacturers, Prysmian of Germany, Nexans of France, General Cable of the United States, Riyadh of the United States, and Southern Cable of the United States, accounted for 1/4 of the global metal insulated cable market, with Prysmian's market share accounting for 8% of the global market, and Nexans' market share accounting for 7% of the global market, GM's market share accounts for 5% of the global market, while Riyadh and South America's market share respectively account for 2% of the global market.
At the same time, among the world's top manufacturing powers, the United States, Japan, China and Germany account for 58% of the global cable share, of which the United States accounts for 17% of the global cable share, Japan accounts for 9% of the global cable share, China accounts for 28% of the global cable share, and Germany accounts for 4% of the global cable share.
In recent years, with the national economic recovery, the acceleration of mergers and reorganization in the industry, and the response to the call of the Party Central Committee to eliminate overcapacity through transformation and upgrading, etc., have played a positive role in the development of the domestic wire and cable industry. The representative cases are as follows: on July 2, 2011, France's Nexen and Shandong Yanggu Cable Group established a joint venture. Nexen will spend 1.24 billion yuan (about 140 million euros) to hold 75% of the joint venture, and Yanggu Cable Group will hold the remaining 25% of the shares; In February 2012, Nexan completed the acquisition of AmerCable with a value of 275 million dollars. After the merger, Nexan will be promoted to the leading manufacturer of cables for oil and gas industry; In March 2012, Sumitomo Electric acquired the production subsidiary of Vietnam's Hanoi flexible printed circuit board (FPC) from Sumitomo Bakelite. At this time, the merger and reorganization of the domestic industry is still fierce, such as the acquisition of Taixing Shengda shares by Far East Holding Group in September 2012. At the end of 2012, CSSC Cable acquired three subsidiaries through non-public offering of shares: Pearl Cable, Remote Cable and Xizhou Electromagnetic Cable. In 2014, Remote Cable acquired 70% equity of Sunan Cable
In addition, some large cable enterprises with economic and scientific research strength in China have been close to the high-end market by increasing investment in research and development costs and purchasing foreign core technologies. This is the trend of the times. On the one hand, it is due to the high profit rate of high-end cable, on the other hand, it is due to the situation. For example, Europe, the United States and Japan currently have higher and higher requirements for the cables used. It is forbidden to use or import non-environment-friendly cables. With the issuance of the RoHS directive of the European Union, the large-scale adoption of environment-friendly cables has become a global trend. In addition, especially with the outbreak of serious "haze pollution" in different regions of China, it has made the environment-friendly cable a much-needed commodity in the market. At present, although the pace of China's environmental protection cable lags behind that of foreign countries, it still follows the green trend and continues to develop and improve the environmental protection market. Obviously, China's wire and cable industry is constantly seeking change, whether in response to the call of the state or due to the influence of market environment factors, and the striking one is from seeking quantitative change to seeking qualitative change. This change will effectively reverse the current situation of China's wire and cable industry, which is large but not strong, so as to form an internationally renowned cable manufacturer.
