A recent report by Grand View Research estimates that the global wires and cables market size is projected to grow at a compound annual growth rate (CAGR) of 4.2% from 2022 to 2030. The market size value in 2022 was estimated at $202.05 billion, with a projected revenue forecast in 2030 of $281.64 billion. Asia Pacific accounted for the largest revenue share of the wires and cables industry in 2021, with a 37.3% market share. In Europe, green economy incentives and digitisation initiatives, like Digital Agendas for Europe 2025, will drive up the demand for wires and cables. The North American region has seen a vast increase in data consumption, which has resulted in investments by prominent telecommunication companies such as AT&T and Verizon in fibre networks. The report also quotes rising urbanisation, and growing infrastructure worldwide are some of the major factors driving the market. The said factors have impacted the power and energy demand in commercial, industrial, and residential sectors.
The above is in line with the main findings of research by Dr Maurizio Bragagni OBE, CEO of Tratos Ltd, where he analyses a profoundly interconnected world impacted benefiting from globalisation differently. Globalisation is a process that has been driven by technological advancements and changes in global economic policies that have facilitated international trade and investment. The wire & cable industry has become increasingly globalised, with companies operating across borders to take advantage of lower production costs, access to new markets, and other benefits. Wires and cables are used in a wide range of applications, including telecommunications, energy transmission, and automotive and aerospace industries.
Smart grid upgrading and globalisation
Above all, an interconnected world needs smart grid interconnections, thus resulting in rising investments in the new underground and submarine cables. Smart upgrading of the power transmission and distribution systems and developing smart grids have driven the cable and wire market’s growth. With the rise in the generation of renewable energy, the electricity trade is anticipated to increase, thus resulting in the construction of high-capacity interconnection lines in turn driving the wires and cables market.
However, this growing renewable power capacity and energy generation have further augmented the need for countries to interrelate their transmission systems. This link-up is expected to balance the power generation and demand through the export and import of electricity.
While it’s true companies and countries are interdependent, globalisation is essential for securing supply chains, growing customer bases, finding skilled and unskilled labour, and providing goods and services to the population; Dr Bragagni points out that the benefits of globalisation are not distributed equally. Some individuals and communities have suffered job losses, lower wages, and reduced labour and consumer protection standards.
One major trend in the cable-making industry has been the rise of outsourcing. Many companies have shifted production to countries with lower labour costs, such as China and India, to reduce their costs and increase their competitiveness. This has resulted in significant changes in the global distribution of cable manufacturing, with many companies now operating in multiple countries.
Why the harmonisation of electrical approvals in the UK is crucial
The heavily globalised world suffered during the COVID-19 pandemic, which created supply chain disruptions for 94% of Fortune 1000 companies, causing freight costs to have gone through the roof and record shipping delays. However, our industry is also heavily impacted by the lack of harmonised electrical standards, which requires full attention and swift corrective measures. Tratos and other cable manufacturers are experiencing losses in terms of time, money, human resources, and efficiency. This is because the approval granted to one utility company is not recognised by another within the same country, and standards approved in one country may not apply in another. Tratos would support the harmonisation of electrical approvals in the UK through a single institution such as BSI.
The cable manufacturing industry has undergone significant changes in production, innovation, and competition due to the impact of globalisation. Despite the complex issues associated with globalisation, the wire and cable industry should capitalise on the advantages and new prospects it presents. However, it is also crucial for the industry to tackle the challenges posed by overregulation, trade barriers, protectionism, and evolving consumer preferences. As the industry transforms, companies must stay informed about these trends and adjust to the shifting environment.
Post time: Jul-21-2023