One of the reasons for the formation of ABC cables is overcapacity

1 trillion of the annual output value of the whole world to see the prosperity of our ABC cable industry but revealed the industry overcapacity crisis. China's ABC cable industry overcapacity in the market, but also with the government. Some local government "to the money, to the land, to the policy" distorts the market supply, and the enterprise has no control to expand production capacity.

Industry and Information Technology Ministry of equipment industry our reinstall office director Zhang Ronghan in the second session of China (Wuhu) ABC cable Expo and product quality summit to provide a set of data shows that in 2012 China cable industry general ABC cable production equipment utilization rate is generally less than 40% and in high pressured ABC cable production capacity utilization rate of 60%.

"Small ABC cable companies operating rate of less than 30%, cable industry capacity has been far more than the domestic market demand for cable, and even to meet the global 70% market." Jiang Huajun, general manager of Far East cable Limited by Share Ltd.

Not only has the same view as Jiang Huajun, Jiangsu Shangshang cable group chairman Ding Shanhua said, but the cable industry also has serious overcapacity, and due to the extensive development, the industry average profit rate has been declining.

In recent years, the international financial crisis, the deep impact of the international market continued to slump, domestic demand growth slowed down, and the supply of ABC cable products in China has become increasingly prominent. Business difficulties, a sharp decline in profits, the industry is on the verge of a comprehensive loss.

Wei Chuanzhong, deputy director of the State General Administration of quality supervision, said that with the rapid development of economic development by high-speed to medium and high-speed conversion, the ABC cable industry will be largely affected by the lack of market demand. In particular, the long-term existence of excess capacity will aggravate the market competition intensity.

Wuwei County Province, Anhui province is the country's four largest ABC cable base, 2012 ABC cable industry output value was over 40000000000 yuan. The county magistrate Zhang Zulu said, Wuwei County ABC cable industry after 20 years of rapid development, the past few years under the macroeconomic downward pressure, financial crisis, and cable industry overcapacity, many ABC cable companies are in trouble.

"At present, ABC cable industry overcapacity is the formation of the industry's internal vicious competition one of the root causes." China Electrical Appliance Industry Association wire and cable branch executive vice secretary-general Wu Shimin think.

Who should come to our rescue cable industry overcapacity? Nothing more than two paths: market and government. From the government, with a clear industrial policy to limit the capacity surplus areas, guide enterprises to change the scale expansion of the extension of the inertia of thinking, rationally according to the needs of the market to adjust the direction of development, to accelerate the elimination of low-end production capacity and equipment, to achieve the transformation and upgrading.

Production capacity of long-term excess becomes shoddy, shoddy, low-cost low-quality competition, deliberately evades supervision, at the expense of quality "to seek" profit-driven market an important incentive. Market consumption of poor cable, the capital return to the enterprise, enterprises, and production of inferior cable. So the vicious circle if not regulated, will inevitably occur in vicious competition in the market, the healthy development of the industry crisis, the impact of the national economy sustained, and healthy development of the overall situation, affecting people's livelihood and social stability of the overall situation.