Global Wire Harness Market to Touch Valuation of $39.29 Billion by 2028 | Manufacturers Need to Build Strong Relationship with OEMs to Sustain
Global wire harness market is valued at USD 26.23 billion in 2021 and is projected to attain a market size of 39.29 billion by 2028 at a CAGR of 5.93% during the forecast period, 2022–2028.
Westford, USA, Dec. 14, 2022 (GLOBE NEWSWIRE) — SkyQuest’s analysis of the wire harness market reveals several key factors that are driving growth and profitability in the sector. The first is the increasing use of wire harnesses in automobiles. Wire harnesses are used to connect electrical components in cars, and they are becoming increasingly complex as cars add more electronic features. This complexity is driving up demand for wire harnesses, and we expect the market for automotive wire harnesses to grow at a CAGR of 6% between 2022 and 2028. Another factor that is driving growth in the wire harness market is the Increasing use of electronics in other industries. Our industry analyst expects the market for industrial wire harnesses to grow at a CAGR of 8%in the years to come. Wire harnesses are also being used increasingly in consumer electronics, as manufacturers add more features to their products. The market for consumer electronics wire harnesses is expected to grow at a CAGR of 10%.
SkyQuest’s wire harness market analysis includes a comprehensive analysis of the key players in the market, as well as an analysis of the competitive landscape. The study provides a detailed overview of the market, including its history, structure, and major players. It also covers the major trends impacting the industry, such as the rise of electric vehicles and the growing demand for connected car technologies. The study contains a comprehensive SWOT analysis of the market, as well as detailed forecasts for the market’s future growth.
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Key Wire Harness Market Report Findings: Manufacturers Need to Build Strong Relationship with OEMs to Sustain
The report includes an in-depth analysis of the competitive landscape, cost structure, and end-market trends. The report finds that the wire harness market is highly fragmented, with the top 10 players accounting for only 30% of global revenue. The industry is also capital intensive, with an average wire harness costing $800 to $1,200 to produce. The automotive sector is the largest end market for wire harnesses, accounting for 30% of global demand. The aerospace and defense sector is the second largest end market, accounting for 15% of demand. The report concludes that the wire harness industry is ripe for consolidation. In order to compete effectively in this increasingly consolidated market, companies will need to focus on reducing costs and investing in new technologies.
Asia-Pacific is currently the largest wire harness market, followed by North America and Europe. The study projects that Asia-Pacific will continue to dominate the market in the future, due to the rapid growth of the automotive industry in emerging economies such as China and India. The report concludes with some key recommendations for companies operating in the wire harness industry. First, SkyQuest advises companies in the global wire harness market to focus on expanding their presence in Asia-Pacific, where there is significant untapped potential. Second, players should invest in R&D to develop new technologies that can help them stay ahead of the competition. Finally, companies need to focus on building strong relationships with original equipment manufacturers (OEMs), as they are increasingly playing a key role in determining market share and customer retention.
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Global Wire Harness Market is Consolidating
SkyQuest’s analysis of the market reveals that the segment is ripe for consolidation. Over the past five years, the market has seen a wave of mergers and acquisitions (M&A), with the top 10 firms including Delphi, Sumitomo Electric and Yazaki now accounting for more than 30% of global revenue. We project that this trend will continue, as larger companies look to expand their geographic reach and product offerings through M&A.
Currently, the wire harness market is highly fragmented. This fragmentation, combined with the industry’s strong growth prospects, makes it an attractive target for consolidation. Since 2014, there have been more than 20 M&A deals in the wire harness space. The majority of these deals have been between small regional players, but we expect to see more consolidation among the large global players in the coming years.
Today, the wire harness market is growing at a healthy clip, driven by robust demand from the automotive and aerospace sectors. Global revenue is expected to reach $39.29 billion by 2028, up from $26.23 billion in 2021. Our study expects this growth to continue, driven by rising vehicle production and continued growth in electric vehicles (EVs). The automotive sector is the largest end market for wire harnesses, accounting for more than 30% of global demand and this share to remain unchanged over the next seven years.
Rising Raw Material Prices, Increasing Labor Costs, and Intensifying Competition from Asia are Top Challenges in Global Wire Harness Market
The wire harness market is facing several challenges, according to a new analysis from market research firm SkyQuest. Rising raw material prices, increasing labor costs, and intensifying competition from Asia are the top three challenges facing the industry.
Fluctuating raw material prices is hampering operation profits of manufacturers in the global wire harness market, who are struggling to cope with the volatility. In the past year, the prices of copper and aluminum, two key ingredients in wire harnesses, have fluctuated wildly. Copper prices surged to a four-year high in June 2018 on the back of a tightening global market, before tumbling to a one-year low in August 2019 amid concerns about weakening demand and reaching all-time high in April 2022. Aluminum prices have been similarly volatile, hitting a seven-year high in April 2022. The price fluctuations have had a direct impact on wire harness manufacturers’ bottom lines.
Many companies in the global wire harness market have been forced to raise prices to offset higher input costs, which has put pressure on margins and weighed on profits. The situation has been further complicated by the ongoing trade war between the United States and China, which has led to tariffs on a range of products, including wire harnesses. Looking ahead, it is unclear whether raw material prices will stabilize or continue to fluctuate. This uncertainty makes it difficult for wire harness manufacturers to plan for the future and make long-term investment decisions. I.
The second challenge facing the wire harness industry is increasing labor costs. Labor costs have been rising across the globe, and the wire harness industry is no exception. In order to compete with manufacturers in Asia, who often have lower labor costs, Western manufacturers will need to find ways to reduce their own labor costs.
The third challenge facing the wire harness market is intensifying competition from Asia. In recent years, Asian manufacturers have made significant inroads into the global market, posing a serious threat to the profitability of their Western counterparts. Asian manufacturers have benefited from a number of factors, including lower labor costs, economies of scale, and government support. As a result, they have been able to undercut Western manufacturers on price while still maintaining a high level of quality. The increased competition from Asian manufacturers is expected to put pressure on the profit margins of Western manufacturers in the coming years. In response, Western manufacturers will need to focus on improving their efficiency and cost-effectiveness in order to stay competitive.
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Key Players in Global Wire harness Market
- Fujikura Ltd.
- Lear Corp
- Furukawa Electric Co.
- Aptiv Plc
- LEONI AG
- Yazaki Corporation
- THB Group
- Motherson Group
- Sumitomo Electric Industries Ltd.
- AmWINS Group Inc.
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