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"Chinese wire and cable enterprises will be eliminated by 40% by 2020." The general manager of China Cable Materials Exchange recently told reporters. When the reporter questioned his prediction, he listed some facts and thoughts on the industry.

He said that China's wire and cable market has more than 7,000 manufacturing enterprises, an output value of 1 trillion yuan, and nearly 700,000 employees, the total number one in the world. Industries are concentrated in Guangdong Province (Dongguan City, mainly wire), Jiangsu Province (Yixing City, mainly power cable), Hebei Province (Ningjin County, mainly low-voltage cable), Anhui Province (Wuwei County, special wire Cable), Henan, Chongqing, Shandong and other places. With the continuous and rapid growth of the Chinese economy in recent years, cable products have a huge market space. Because of the bottleneck of energy and power shortages in China's economic development, China's continuous increase in investment in electricity has made the wire and cable industry enter a period of rapid development. However, due to the huge output value and profits of its industry, and more than 90% of domestic cable companies' production capacity is concentrated in low-end products, a large number of small enterprises have entered this industry. Due to the global financial crisis and the adjustment of the domestic economic structure, domestic wire and cable companies generally have insufficient operating rates and overcapacity. Many small companies have even taken the risk of inadequate recharge, resulting in a product qualification rate of only 1/3 in this industry. Therefore, companies that are not superior in quality, technology and brand must be eliminated.

The wire and cable industry is China's basic supporting industry. It has a wide range of products and a wide range of applications. It can even be said that all social links and related departments of the national economy are inseparable from the use of wires and cables. These include power, construction, communications, and manufacturing industries. In addition, wires and cables are also indispensable basic equipment for transmitting electrical energy, transmitting information, and manufacturing various motors, instruments, and meters to achieve electromagnetic energy conversion. They are essential basic products in the future electrification and information society. During the "Eleventh Five-Year Plan" period, China's wire and cable industry's sales output value increased significantly on average. In 2011, China's annual output value of wire and cable was more than 1 trillion yuan, becoming the world's number one wire and cable producer. However, the average profit of the industry in 2012 was only 4%, which is already lower than the average profit of the Chinese electrical industry.

He told reporters that compared with the wire and cable industries in Europe and the United States and other countries, China is still in a big but not strong situation, and there is still a big gap with well-known foreign wire and cable brands. For example, 3 companies in the United States accounted for 54% of the national scale; 7 companies in Japan accounted for 86%; 12 companies in the UK accounted for 95%; and 19 larger companies in China accounted for only 11.7%. Because China ’s wire and cable industry has a low concentration and low barriers to entry, some small companies are pursuing high profits, and copper-clad bad copper, or copper-clad steel, and copper-clad aluminum are used for cables. . Although many small companies enter the industry, many of them will be eliminated in future competition. The reason these companies will be eliminated is because this industry is a wide-entry and strict-exit industry. Its threshold is in the market, and the market will naturally eliminate these enterprises.