Abstract

This report is intended to give a general overview of the global automotive market, and provide information about how Nexans is serving this market. It opens with a brief introduction that explains the positive and negative forces operating within the complex world of automobiles, which ultimately affect the supply industry; then focuses on some major challenges.

It also draws up a comprehensive list of what the automotive industry expects from a cable supplier. The third section presents Nexans’ overall product offer and explains Nexans’ service approach.

Introduction: an industry on the move

Some old and recent trends
In the primitive days of motoring, the cable content in a car was absolutely minimal. For instance, the old 1916 hand-cranked Model T Ford had four coils, and a magneto to power the lights. There was only a handful of wire pairs. Once the engine was running, the driver switched from a little “hot-shot” battery to the magneto. Over the years, cable content in cars went up dramatically. By 1948, a Chevrolet contained 42 metres of cable, with six harnesses, 55 leads, and 32 connectors, weighing overall some 4.5kg. Today’s Chevrolet Suburban contains 1.5km of cables, with 20 harnesses, 804 leads and 326 sealed and non-sealed connectors, all of this weighing in at some 23kg. If one adds the winding wires that are used for alternators, starter ignitions, relays and the many motors in a modern automobile the weight goes up by another 3kg. This largely copper and copper-alloy mass continues to rise (in 1999 there were 2.6kg of winding wire in an automobile; by 2003, this had risen to 3.2kg, and by 2006, it will reach 3.6kg).

Automotive harnesses that link information and energy systems

Depending on the model and the conveniences under the hood and in the cabin, the amount of cable can attain 3.5 to 5km. A tremendous array of cables exist for control and monitoring vehicle behaviour; guidance, navigation and telematics; and driving assistance, automation, comfort and entertainment (infotainment). In the near future, apart from regulating these many functions, an onboard PC will be in constant contact with a central server, to assure continuous automatic control. This will allow for “platoons” or electronically coupled “trains,” where a group of 20 cars will travel at high-speed one metre apart. Accelerometres linked to various actuators will govern steering, braking and throttle to maintain ideal speed and car position. In addition, there will be 360 radars, lasers or video cameras to constantly monitor obstacles and dangers and make sure that the car is in a constant position relative to surrounding traffic.

Along with overall body design, features like this are highlighted at every major car fair. What purchasers and the automobile press sometimes forget is that much of this new technology is based on cables: special cables for heated seats, automated windows and ABS systems; plastic optical fibre cables for multimedia applications; power and control cables for energy; instrumentation cables; and coaxial cables for communications and GPS navigation. Virtually all of these cables are manufactured by Nexans, the only manufacturer to have an equivalent range of cable products, connectivity, accessories and services.

Flat cables

The reason behind the proliferation of cables in automobiles is that customers want cheaper and safer cars, with increasing intelligence and eco-friendliness. There are also wider conservational and demographic factors. Gas reserves are limited, and the six billion-plus world population is clamoring for private transportation. In fact, in the first decade of the millennium, overall vehicles sales are slated to grow by 27%, from 58 million to 74 million vehicles. Growth in the developed world will be steady, but increasing only by 7.7%. More significantly, developing markets will increase by over 80% over the same time period. This shift in demand has given rise to an important trend among automobile manufacturers, or Original Equipment Manufacturers (OEMs).

Standardisation, outsourcing and niche manufacturing
Concentration among the big seven or nine OEMs has had several important effects. Since there are fewer major manufacturers serving a widely-scattered public, synergetic efforts are needed to unify products so that cars can be serviced wherever they are, whether in Europe, the USA, South America or the Far East. This calls for global presence; but it also means standardisation and a unification of parts numbers. This especially applies to cables, which serve a dual energy/data function in an automobile. Whatever the system, they are generic elements and need to be easily interchangeable.

Increasingly, manufacturers are outsourcing what is not a core competence in many areas. A growing percentage of the value added to any car is coming from suppliers, who are involved even at the initial design stage. In fact, it is unlikely that any major OEM could build a complete car without the input of the entire supply community, who are expected to take responsibility for research, design, testing, and assembly line processes. We are moving away from a product approach to an integrated systems approach in which R&D, customised services and logistics are important. Today’s door or front end is no longer merely “assembled”. It is a geometrically closed unit (system) incorporating cables, contacts, motors, etc. A brake system is no longer perceived as the wheels, but includes the brake pedal, the leads, the sensors, and onboard computer with a harness stretching through the entire car. Once again, cables play a key role in making these modules and systems work.

Automotive production line

Customers no longer want basic models with a change of colour to differentiate them. They expect an extremely wide choice of models from every manufacturer (minivan, full-sized van, large van, hard-top, convertible, etc.) They also want to customise their car in terms of conveniences and comfort. Thus, in seeming contradiction to the trend towards standardisation, there is a real move towards splitting-up the product into niches to create highly individualised automobiles. This has a high-impact on the production process and logistics. For example, when a car is being built with a sliding roof, followed by one with a solid roof, or with or without climate control, customised cables and harnesses have to be delivered in-line and in the right sequence. The ultimate product differentiation is the so-called “reconfigurable vehicle”. By using Internet Reconfigurable Logic (IRL), the automotive manufacturer will build variety and upgradeability into a single car. Once again, flexible, modular cabling will play a key role in making the new world of automotive electronics systems, computer, and software applications a reality.

Challenges and customer expectations

This new automotive environment, driven by OEM concentration, increased outsourcing, customisation and niche products, and advanced IT-based technologies has created a number of challenges:

• First, cost pressures will continue to be strong in developed markets for both OEMs and their suppliers. As with other consumer products, buyers will continue to want to get more technology for less money.
• Secondly, since the market is increasingly international and consolidated, major players in the industry are going to have to have a global footprint to be competitive. Suppliers will have to follow the OEMs wherever they choose to go. Sometimes, this will mean strong supply chain management with the ability to keep inventories low, while delivering to far-flung points from multiple sources of provisioning.
• Thirdly, customers will expect equal quality and performance from a car, wherever they happen to live. Thus, OEMs and their suppliers are bound to find ways of keeping quality uniform, even though production is done in countries where labour conditions and costs can vary greatly. In addition, quality standards and certification are essential if uniformity and consistency are to be achieved. It is time to apply the new (2002) ISO/TS 16949 standards which were developed to unify European, American and Japanese production.
• Fourthly, integration is a must, not only from the point of view of product, but also in terms of co-operation among suppliers, and suppliers and OEMs. This more flexible approach requires an increasing exchange of information among the automotive community, and means getting everyone involved early in the engineering and development process.
• The fifth challenge is innovation. Few sectors have been as creative as the automotive sector, in terms of manufacturing processes, logistics and product. It has long been recognised that (like clothing) automobiles make a strong appeal to taste and preference, and these tend to change regularly. Innovations in areas such as IT, the Internet, and new satellite technologies are having a tremendous impact on the industry, as well. Today’s advanced technologies are already pointing to a new form of “sustainable” car travel in the future, which will reduce needless delays and traffic jams, save precious resources, and safeguard people and the environment.

Winding wires and the automotive market

The automotive sector is of key and growing importance to the winding wires industry, with estimates that the automotive sector’s winding wire requirements will grow at a rate of about 10% per year, compared to a total growth for the winding wire market of around 2 to 3% per year. Nexans’ market share in Europe of the automotive industry is around 35%.

Bare wires carry electricity and have applications in cables, winding wires and railways

The company supplies and works closely with all the top, first tier suppliers of the equipment supplied to car manufacturers around the world. These suppliers include top names such as Bosch, Delphi and Valeo. In addition, the global automotive equipment supplier Valeo has chosen Nexans as its main provider of about 70% of the winding wire destined for products to be used by automotive manufacturers in Europe, Asia and the Americas. The winding wire market will be affected by many new technologies in the automotive sector, with those likely to have the most impact being:

Nexans: a global leader in the industry

Nexans provides a wide range of automotive products, including electrical harnesses; precision wires for sensors; winding wires for electrical motors, generators and transformers; power and control cables; protected cables for instrumentation, communications and navigation. Passenger safety and comfort are assured by its reliable ABS cables, and special cables used in heated seats and automated windows, for instance. As car intelligence rises, so do the number of chips, cables and connectors, as well as power requirements.

Winding wires

The eventual upgrade to 42 volts will enable more effective steer-by-wire, ride control, power-breaking and heating. Recent Nexans innovations meet the challenges of heat, space, data capacity, weight, resistance to electromagnetic interference (EMI) and electrical current load. Nexans new plastic coatings resist 125°C temperatures and beyond (to 185°C), while thinner and flat cables resolve the problem of limited space. EMI-free Plastic Optical Fibres (POFs) and a new generation of copper cables for multiplexing deliver higher onboard data capacity. As for growing power needs, thinner copper cables will carry more current. Through a mastery of both energy and information cables, Nexans helps the automotive industry to replace mechanical systems by electrical ones so as to build a safer, smarter car.

A wide range of products for the automotive industry

Nexans designs, engineers, and produces efficient automotive harnesses of up to 300 wires, that link information and energy systems for lights, air-condition and new generation dashboard intelligence. Controlling all production processes, from melting the copper cathodes to drawing or rolling the material, the company manufactures rods and conductors from copper, brass, bronze or aluminum, with diameters ranging from 0.030 to 12mm, or flat wires for flexible flat cable (FFC) applications. The surface can be bare or tin, silver or nickel-plated, depending on the final usage. Nexans also provides multi-wire bunching and stranding products and all automotive conductors ranging from 0.22 to 70mm2. A special bronze wire for contactors provides higher mechanical characteristics.

Nexans provides a comprehensive range of automotive cables

Nexans durable winding wires are present throughout the automobile, especially in the passenger cabin in the dozens of small motors and servos used for safety comfort and conveniences. Nexans assures that electronic coils can be wound quickly and smoothly by applying a special enamel which provides insulation and resistance to heat, mechanical shock and chemicals. Coils are found in engine-related items, and all instruments and dials for speed and fuel, etc. Nexans’ high-precision manufacturing techniques and secure insulation guarantee fail-safe performance. A new generation of Magnebond® self-bonding wires, using a special thermal adherent coating, saves manufacturers a step in motor production.

Many types of special power and control cables are also used wherever energy or information are needed, such as in battery leads, heated seats or control functions. Nexans products are known for being extremely light, oil-resistant and safe. To safeguard the environment and to reduce the effects of a possible accident, Nexans developed a variety of halogen-free cables that are flame-retardant and produce low smoke in the case of fire. Since there is now far more heat under the hood, the company has also been working on cross-linked, polyethylene, polypropylene, and co-polymer instrumentation cables that can handle temperatures of up to 150°C and beyond. In fact, a robust cable for oxygen sensors (which measure unburned fuel in the exhaust to help provide a cleaner burn) are thermal rated up to 300°C. The company also provides cables used on brake-pad wear sensors.

In addition, Nexans produces a wide range of communication and navigation cables. High-frequency coaxial cables are used for all multimedia aspects of cars: connection with antennas and navigation systems (GPS), connection between the antenna and hands-free GSM, radio links, remote door-control. The company produces an entire range of EMI-protected RG58, RG174 and RG179, RG142 and RG316 cables, plus box duplexers. It designs customised versions to meet the specific needs of the automobile industry. Nexans was among the first to develop CAN-bus cables which rapidly became an industry standard, while at the same time introducing a new generation of multiplex copper solutions for data transmission.

The service dimension

Nexans is continuing to innovate in the automotive sector. For example, to prepare for the transition to 42 volts, finding ways to improve the efficiency of current 12V motors, and developing winding wires for a new generation of hybrid and all-electric vehicles. The company’ Magnebond® self-bonding technology allows components, such as alternators, to greatly increase electrical output without an increase in cost or weight. Nexans is number one world-wide in cables of all kinds, but the automotive unit is adaptable enough to provide customer-specific solutions. Thus, global resources, including plants located in both developed and developing countries, make it possible to have the presence and responsiveness of a medium-sized company.

Conclusion

Nexans sees its role in the next quarter of a century as a “preferred supplier” to the automotive industry as it continues to more towards global procurement policy, integrated buying and shared responsibilities. More than ever before, Nexans believes that there is a need to go “beyond cable” in order to add value to products, do innovative research, and provide a host of behind-the-scenes services ranging from new product design to the kind of long-term support that auto-makers and their suppliers need to meet future opportunities.