Global Shifts in Auto Harness Production
In the automotive wiring industry there has been a global shift of the production of auto harnesses away from higher cost countries to ones where labour costs are lower. This shift began to happen around 10 to 15 years ago, but it has gathered momentum over the last five years as major players in the car industry have relentlessly demanded lower costs from their suppliers. To simplify logistics and to avoid high transport costs, the shift has taken place within major regions. Thus production of auto harnesses for the North American market has moved to Central America and the Philippines, while production in Japan has shifted to Vietnam, China and the Philippines. In Europe there has been a shift in harness production from the traditional locations in Western Europe to Eastern Europe, but there has also been growth of harness production in the countries of North Africa.
Auto Harness Production in Tunisia and Morocco
The main bases for auto harness manufacture in North Africa are Tunisia and Morocco, though there is also growing activity in Egypt. Export processing zones, for example Casablanca EPZ, where there is freedom to import duty-free materials for export assemblies, have encouraged export-orientated investments by foreign companies. Several of the large global auto harness groups have production operations in Tunisia and/or Morocco, and there is also a local company, Cofat (part of the Elloumi group), that has harness assembly operations in Tunisia and Egypt. This Tunisian group also owns Coficab, a producer of auto cables with operations in Tunisia, Morocco and Portugal. Sidilec is another Tunisian company producing harnesses, for automotive and other applications, but there are also several other local producers of harnesses and assemblies for European OEMs.
Harness Exports Grow
Harness exports from North Africa are mainly aimed at countries like France, Italy and Spain, located across the Mediterranean, but there is also substantial trade between Tunisia and Germany. Tunisia is the largest exporter of harnesses, but over the last five years there has been particularly strong growth in harness exports from Morocco, with Spain the main destination.
Other Auto Harness Activity in Turkey
In addition to the developing activity in harness exports from North Africa, there is also significant production of harnesses in Turkey. Unlike most other countries in the MENA region, Turkey has a significant vehicle production industry. Hence there is production of harnesses in Turkey for local production as well as for export. Exports from Turkey have actually declined since 2003, which must be due to relatively high costs.
Iran in Isolation
Iran also has a vehicle manufacturing industry that is supplied with harnesses by local assembly operations, but the cars produced in Iran are very old models. Exports of harnesses from Iran are therefore very low.