Investigation and Analysis of Development Status of China's Wire and Cable Industry in 2012

In recent years, China's wire and cable industry has developed rapidly. However, due to excessively extensive development, there is a serious surplus of production capacity, and the quality is poor, and the development and safety of the industry are threatened.

Walking on the road from Yixing to Jintan, the road was deserted. The hot sales scene of trucks queuing up a few years ago no longer exists.

Although the season has entered the summer, the current Chinese cable city in Yixing, Guanlin Town, is "wintering," and the entire industry has begun to frugalize and sell to set production.

Wire and cable occupy a quarter of the output value of China's electrical industry, is China's second largest industry after the auto industry, can be called the "blood" of the national economy. What worries us is that the quality of the “dark screen” in the wire and cable industry has become a “mine” that can be detonated at any time!

Worries about quality The China Electric Appliance Industry Association’s wire and cable branch held a working meeting of three directors for seven times before the May 1st. Major cable giants came to the meeting to discuss the industry situation and analyzed the production and operation situation in the first quarter.

"The mainstream opinion expressed concern about the current industrial quality. At present, market supervision has not effectively restricted quality violations in the market, which has caused serious confusion for the law-abiding companies attending the conference," said one expert at the Shanghai Cable Research Institute.

In recent years, due to the excessively extensive development, the quality of the wire and cable industry has been worrisome and there has been a dilemma of “bad money drives out good money”.

According to a recent survey, more than 40% of companies in the industry have experienced unfavorable competitions such as winning bids at lower cost prices and maliciously lowering prices among their peers.

With reference to the “Bid Invitation and Bidding Law”, China often implements the “approved minimum bid price method.” On the surface, the lowest bid awarded by the evaluation cuts the competitive system of the bidding system and reduces the subjective factors of bid evaluation experts. Disturbance helps to make the evaluation results more scientific, reasonable and fair.

The reality is that many bidders use this to maliciously lower bid prices in order to achieve the goal of winning the bid. However, after winning the bid, various claim methods are used to cause the final price to be much higher than the bid price, making the low price bid lose its significance.

As the prices of copper and various raw materials in the market have risen sharply, the bidding prices for wires and cables have become relatively low. If enterprises produce in accordance with industry standards and national standards, and strictly implement the technology, they will have to make substantial losses. The production process of wire and cable is not complicated and requires two materials, one is conductor copper or aluminum and the other is plastic that is wrapped outside. Driven by interests, some companies began to ignore raw materials for entry into the factory in order to save costs, and some even deliberately use inferior materials. However, the service life of inferior cable jackets is only 1/10 of the qualified products.

To hide their eyes and ears, some manufacturers even use good copper package copper, or copper clad steel, copper clad aluminum cable. Poor cables and wires are difficult for most people to identify.

For plastic materials, manufacturers are also trying their best to cut corners and materials, such as the purchase of waste needle bottles, hanging needles and other medical waste at low prices, or imported waste plastics. There is no problem with qualified products for 20-30 years, and inferior plastics. Two to three years will be aging off.

Manufacturers so arbitrarily reduce production costs, deliberately cut corners, will inevitably lead to conductor resistance, cross-linking and other key indicators can not meet the standard requirements.

In view of this industry status, Jiang Xipei, chairman of the Board of Directors of Far East Holdings, a leading company in the wire and cable industry in China, publicly stated: “At present, at least 2/3 of the products in the wire and cable industry are unqualified, or are inferior products, industry orders and product quality. It's time to go to the tube!” Far East is currently the listed company with the largest scale of production and sales, the largest number of employees, and the highest market value in China's wire and cable industry.

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