1 Automotive wiring harness type and composition

If the car is compared to a living body, then the wiring harness inside the car is the car's nerves and blood vessels. Automotive wiring harness is an important part of the car, carrying the car power and signal transmission. Automotive wiring harness is mainly composed of three parts, namely, cables, wrapping materials and connectors (terminals). Specific process: wire harness manufacturers speak upstream cable manufacturers to provide cables and copper and other punched and formed by the contact parts of the terminal crimping, through the plastic pressure insulator or additional metal shell, etc., to wire bundle formed by connecting the circuit components.

2 Automotive wiring harness cost composition

From the perspective of the upstream industry, the raw materials for the production of automotive wiring harness industry are mainly wires, terminals, sheaths, seals and other items involving copper, rubber, plastic and other materials, and the price is mainly determined by the market price of copper, petroleum, natural rubber and other chemical materials and other commodities. According to the annual report of Hukuang Company in 2021, the proportion of direct material cost to cost is the highest, reaching 76.64%. The automotive wire harness industry is a typical labour-intensive industry, which requires a large number of manpower to carry out assembly line operations such as insertion and implantation, wiring, gluing and tape rolling in the manufacturing process of wire harnesses. Therefore, the wiring harness industry accounts for a relatively high labour cost, according to the 2021 annual report of Hukuang, the direct labour cost of the wiring harness accounted for 13.43%.

Among all raw materials, cables (wires), sheaths, and terminals account for the top three. According to the data in the prospectus of Hukuang, in 2019, cables, sheaths and terminals accounted for 29.70%, 18.73% and 18.17% of the company's total purchases, and in 2017, 2018 and 2019, Hukuang's purchases of wires, terminals and sheaths accounted for 65.66%, 64.78% and 66.60% of the total purchases in total, and the top three raw materials purchases were relatively stable. The proportion of the top three raw materials is relatively stable. The core material of the cable is copper, so the copper material cost is the absolute main force constituting the cost of the cable, mainly copper rod and copper wire. The same material accounts for more than 80% of the main operating costs of cable manufacturers. According to the prospectus data of cable maker Kabiyi, the raw material cost of the company accounted for 93.69% of the main operating cost in 2019, of which the copper material cost accounted for 86.23%.

3 Automotive Wiring Harness Market Pattern

Automotive wiring harness belongs to automotive parts and components, and is in the middle of the entire automotive industry chain, with copper, rubber and chemical products in the upstream, and vehicle manufacturers and some parts supporting suppliers in the downstream. The raw materials for wiring harnesses are mainly wires, terminals, sheaths, etc., and the materials involved are mainly copper, rubber and plastics, etc. The downstream is mainly domestic and foreign automobile manufacturers. The downstream mainly consists of domestic and foreign automobile OEMs, supplemented by some parts and components suppliers. Vehicle manufacturers have strong bargaining power in the price game; parts and components suppliers are mainly first-tier suppliers who cooperated with vehicle manufacturers in the previous period.

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