Car Wars: How shifting auto demand is reshaping Europe’s wire and cable market

The European automotive market is in the middle of a quiet but brutal fight. On one side is a historically strong domestic car industry, confronting weak demand, strict regulations and rising costs. On the other side are increasingly competitive imports, especially cheaper electric vehicles (EVs) from China and, to a lesser extent, Japan and Korea. Layered on top is a new vulnerability: access to the “simple” chips that keep vehicle electrical systems running.

For the wire and cable industry, the outcome of this “Car War” is not just an automotive story. It is directly tied to where, and how fast, demand grows for low-voltage harnesses, high-voltage EV cables, magnet wire, power cables and data cabling.

A smaller home market for European cable makers

European car sales have picked up slightly in late 2025 but remain well below pre-pandemic levels. ACEA (The European Automobile Manufacturers Association) data show that although registrations rose in October, volumes across the EU are still significantly lower than in 2019. Battery-electric cars now represent around 16 percent of EU new car sales, but ACEA warns that this remains below the pace required to meet transition goals.

In the UK the situation is even more challenging. SMMT (Society of Motor Manufacturers and Traders) figures show that 905,233 vehicles were built in 2024, almost 12 percent down on the previous year, pushing production below one million units. Output continued to struggle in 2025, with manufacturing falling by roughly 12 percent in the first half of the year. A major cyberattack on one of the UK’s largest carmakers further reduced September volumes and caused disruption across the supply chain.

This matters because each vehicle represents a substantial cable package. A modern internal combustion engine car typically contains between three and four kilometres of wiring, while an EV contains at least that much and often more once high-voltage cabling, battery interconnections and additional data wiring are considered. Every 100,000 units of lost production removes hundreds of millions of metres of wire and cable from the system, reducing demand for low-voltage harnesses, high-voltage EV cable, magnet wire and the charging and infrastructure cables that support OEM investment in testing and plant upgrades.

Chinese and Asian EVs: more copper, but not necessarily in Europe

As European production has stalled, EV imports from China have accelerated. ACEA’s EU–China trade figures show that the EU imported 438,034 battery-electric vehicles from China in 2023, worth €9.7 billion. Chinese-built cars, including Western brands manufacturing in China, now account for more than 20 percent of EU BEV sales, with Chinese brands alone responsible for around 8 percent. Eurostat data indicate that China represented about half of all extra-EU electric car imports by value in 2023.

Recent analysis suggests this share has continued to rise through 2025, with Chinese plug-in hybrids gaining ground as they sit outside the full scope of EU EV tariffs. Even with anti-subsidy duties between 17 and 38 percent, many Chinese EVs remain significantly cheaper than European equivalents. Japanese and Korean manufacturers also retain strong positions in hybrids and compact EVs, adding further competitive pressure.

For the wire and cable industry, three consequences stand out:

1. Demand shifts geographically.
   When a car sold in Europe is assembled in China, Japan or Korea, most of the wiring harnesses, high-voltage cables and motor windings are produced close to the manufacturing site. Much of the copper still arrives in Europe inside the finished vehicle, but the value-added cable and harness production happens abroad rather than in EU or UK facilities.
2. European suppliers face intense cost pressure.
   Competing with Asian cost structures while operating in higher-cost European environments is increasingly challenging. OEM cost-down programmes, energy prices, labour costs and regulatory obligations all place downward pressure on margins for both low- and high-voltage automotive cable.
3. New entrants and inward investment are selective.
   Some Chinese and Asian firms are expanding within Europe through battery plants and component factories, generating local demand for power cable, control cable and building wire. However, the high-volume automotive harness work often remains tied to global supplier networks headquartered overseas rather than shifting entirely to Europe.

Chips, export bans and the new vulnerability in vehicle electrics

If competitive pressure from imports represents the slow grind of structural change, the recent chip dispute with China shows how quickly the landscape can shift.

In October 2025 ACEA (The European Automobile Manufacturers Association) issued an urgent warning about disrupted chip supplies from Nexperia, a major automotive semiconductor supplier. The Dutch government had taken control of Nexperia’s EU operations on security grounds, and Beijing responded by halting chip exports from the company’s Chinese factories. Reporting in The Guardian revealed that European carmakers were only days away from halting production, with manufacturers in the EU, UK and Japan warning that the disruption could force them to idle assembly lines.

The episode was widely described as a wake-up call for Brussels. It demonstrated how China can use supplies of relatively low value but essential components, along with critical minerals, as geopolitical pressure points.

The link back to the wire and cable industry is immediate. The disrupted Nexperia chips are the basic semiconductors that support lighting, power steering, battery management, motor control and safety systems. Without them, the vehicle’s electrical architecture cannot function, no matter how advanced its cabling.

When OEMs cannot secure chips, they slow or stop production. As a result, cable factories face stop–start ordering cycles, delayed call-offs and periods of under-utilised capacity. Export controls on critical inputs such as gallium, germanium, graphite and rare-earth magnets add another layer of uncertainty for EV motor and power electronics programmes that rely on magnet wire and specialised insulation systems. This volatility makes it harder for cable producers to justify long-term investment in automotive lines, even where EV demand projections appear strong.

Risks and opportunities for the wire and cable sector

Taken together, these forces create a complex environment of both risk and opportunity.

European production remains subdued, restricting the regional base for automotive cable demand. Each imported vehicle contains harness and cable content that could otherwise have been manufactured in EU or UK facilities, gradually eroding local expertise and scale. The industry is also exposed to wider supply-chain fragility, with digital infrastructure, critical minerals and geopolitical issues able to impact cable demand just as much as copper pricing or OEM order cycles.

Yet opportunities are emerging. The EU and UK are investing heavily in EV infrastructure, charging networks, grid upgrades and domestic battery manufacturing. These projects require substantial volumes of medium- and low-voltage power cable, control cable and data cabling. OEMs are also transitioning towards zonal wiring architectures and higher-voltage platforms, opening opportunities for suppliers capable of delivering lighter, higher-performance materials and integrated power-and-data solutions. Increasing emphasis on supply-chain resilience may also encourage more regional or dual-sourcing strategies for critical electrical components, including high-voltage cable assemblies.

Watching the road ahead

For wire and cable producers, the automotive market in Europe is unlikely to deliver the simple, volume-driven growth story many expected from electrification. Instead, it has become a contested, politicised and strategically sensitive environment.

• Global demand for EV-related cable is rising, but a large share of that growth is currently being captured by Asian suppliers.
• European automotive production remains subdued and is exposed to policy decisions in Beijing, Brussels, London and The Hague.
• At the same time, investment in EV infrastructure, battery plants and more resilient supply chains could create new pockets of opportunity for agile manufacturers.

In this sense, Car Wars is not only a battle between automakers. It is also a test of how effectively Europe’s wire and cable industry can adapt to a future in which vehicles are more electric, more digital and more geopolitically exposed than ever before.