TE Connectivity (TE) is the world's largest manufacturer of connectors and sensors, providing various connection solutions in the fields of automobiles, aircraft, power grids, home appliances, electronic products, factories, etc.

TE China Automotive Division recently announced that the first phase of the Kunshan factory has officially started production, and the construction of the second phase of the project has started simultaneously, and the expected production time is 2024. The Kunshan factory is another important layout of the TE Automotive Division in the Chinese market after the three major factories in Suzhou.

TE Connectivity's automotive division is the largest division of TE Connectivity, accounting for approximately 44% of TE's total global sales. TE is committed to providing complete solutions in the field of connectivity and sensing for vehicle and parts companies. TE products are widely used in automotive power systems, safety systems, body and chassis systems, driving information and comfort systems, including industry-leading terminals and connectors, and reliable non-contact sensors.

The business growth exceeded the same period mainly due to the increase in electrification and intelligent related business volume. The highest proportion of TE's business growth came from new energy vehicles, followed by high-speed and high-frequency connections related to intelligence.

Since 2021, the penetration rate of electric smart cars has increased rapidly. The latest data from the China Automobile Association shows that from January to September 2022, my country's production and sales of new energy vehicles reached 4.717 million and 4.567 million respectively, an increase of 1.2 times and 1.1 times year-on-year, and the market share reached 23.5%. In terms of intelligence, according to statistics, in the first half of 2022, the L2 penetration rate increased by 8.9 percentage points to 32.4%. These undoubtedly bring new growth space to supply chain companies with deep technical accumulation, including TE.

TE has been focusing on the layout of new energy and intelligent networking fields since 2014. In the field of new energy, TE has launched a complete set of high-voltage connection, protection and management solutions from charging interfaces, batteries, to electric drives, which can help various vehicle components achieve stable connections in high voltage and high current environments. In the field of intelligent networking, in order to meet the rapidly growing high-speed and high-frequency data transmission needs of connected cars, the company has developed a connection solution compatible with 100M and 1G levels ahead of the market.

From 2003 when Tesla was founded to today, the concept of new energy vehicles has gone through 19 years. Musk devoted himself to it for ten years before finally bringing Tesla to the level of "being able to drive". Even Tesla was extremely struggling in the past few years, and its production capacity continued to be sluggish, and it was not until 2019 that it started to improve slightly. Wall Street even had a famous saying about Musk at the time: "We can only believe half of what Musk says." What supported Musk to persist was his inner dream of new energy vehicles. Like his dream of rockets, he devoted a lot of effort to Tesla.

Tesla is able to occupy the first place in the world's new energy vehicles and is far ahead not only because it was the first to enter the game, but also because of Tesla's years of technological accumulation. In contrast, in China, it started late and developed even later. In addition to BYD's early deployment in the field of new energy vehicles due to its battery advantages, many emerging companies are more interested in cheating than building cars. After subsidies have been slowed down and the waves have washed away the sand, only NIO, Ideal, Xpeng, and Leappo are the leading companies left.

The road ahead is still difficult and long. Musk still doesn't care about the domestic car-making forces. After the second phase of the Shanghai Super Factory is completed, Tesla will reach an annual production of 500,000. China has now become Tesla's main sales location. Musk threw out the "carrot" and attracted many "sticks". In the future, a new energy vehicle war is likely to break out between the two sides.

Looking back at the development of new energy vehicles over the past two decades, the reason why the big guys have flocked to the new energy vehicle manufacturing industry is that this is indeed a very large market. In recent years, the country’s support for new energy vehicles has been super strong. Many companies in our cable supply chain are positioned in the field of connector cable assembly products related to the "three-electric system" (battery, electric drive, and electronic control) of new energy vehicles, and some companies have accumulated certain technologies.

With the development of society and the upgrading of consumption, people's requirements for automobile safety and comfort configuration are constantly increasing, which has led to an increasing demand for related high-frequency data connector cable assembly products.

In addition, whether it is a traditional fuel vehicle or a new energy vehicle, the system configurations of intelligent assisted driving, safety protection, etc. will become higher and higher, which will require the use of related connector cable assembly products, which is value-added. However, what is unprecedented is how terrible things will happen when all eyes are on one point, and everyone has their own opinions.