Christina Amann, Nick Carey

LONDON/BERLIN – A wire harness is a simple component that connects cables. It has been a recurring problem in the automotive industry. It could be a catalyst for the demise of combustion cars, according to some.

The war in Ukraine caused a shortage of auto parts. Wire harnesses from Ukraine are used in hundreds of thousands new cars every year.

While these parts are low-tech and have a low margin, they can still be used to build cars.

Interviews with over a dozen industry professionals and experts suggest that the current supply crisis could make it easier for some legacy automotive firms to transition to lighter, machined harnesses specifically designed for electric vehicles.

Sam Fiorani (head of AutoForecast Solutions’ production forecasting division) stated, “This is one more reason for the industry make the transition to electrical faster.”

Globally, gasoline vehicles still make up the largest share of new vehicle sales. However, EVs have doubled in number to 4 million, which is only 6%, according to data compiled by JATO Dynamics.

Nissan (OTC,) CEO Makoto Umchida stated to Reuters that his company had been pressed by supply chain disruptions like the Ukraine crisis to seek alternatives to the wire harness design.

Automakers and suppliers will shift harness production away from the United States in the near future, however.

According to someone familiar with Mercedes-Benz’s operations, it was possible to fly in harnesses to Mexico from Mercedes-Benz to fill a short supply gap. Japanese suppliers add capacity to Morocco. Others seek new production lines in Poland and Serbia.

THE TESLA MODEL

The harnesses used for fossil fuel cars connect cables that run up to five kilometers (3.1 miles) within a vehicle. They also link everything, from windows to seat heaters. Because they are labor intensive to produce and every vehicle is unique, it is difficult to move production.

For the automotive industry, disruptions to supply in Ukraine was a wake-up call. Suppliers and carmakers said that the plants were still open in spite of the disruptions in supply in Ukraine early on in war. This was due to the hard work of the workers, who managed to keep a smaller flow of parts moving despite power cut, air raid warnings, and curfews.

Bentley CEO Adrian Hallmark stated that the British luxury carmaker initially worried about losing between 30-40% and 40% of 2022’s production due to a shortage of harnesses.

“The Ukraine crisis was threatening to shut down our factory completely for many months. This is much more than what we did with COVID.”

Hallmark claimed that finding alternate production sources was hard because conventional harnesses came with 10 different components from 10 different Ukrainian suppliers.

He said that supply issues had made it more difficult for Bentley to focus on and invest in developing a basic harness that can be used by EVs. This central computer will manage the operation. Volkswagen ETR:, the carmaker plans to launch a completely electric lineup in 2030.

Hallmark stated that the Tesla (NASDAQ: ) model has a totally different wiring concept and we could not change it overnight. It’s fundamentally changing the way we build cars.

Tesla and other electric natives use the latest generation of wire harnesses. These can be cut on automated production lines. Also, they are lighter. This is important because it allows for greater range.

Experts and executives interviewed believed that the bans on fossil fuel cars in Europe and China would soon be lifted. This could allow for redesigns of next-generation harnesses.

Sandy Munro (Michigan-based auto consultant) said, “I wouldn’t put a penny in internal combustion engines now.” He estimates that EVs will account for half of all global new car sales by 2028.

“The future is approaching very quickly.”

“CHANGE OF PARADIGM”

Walter Glück, head of Leoni’s harness business, said the supplier was working with carmakers on new, automated solutions for wire harnesses in EVs.

Leoni is currently concentrating on modular, or zonal, harnesses. They would be broken down into six to eight pieces, which allows for assembly automation and reduces complexity.

“It’s a change of paradigm,” Glück said. Modular wire harnesses are a good option if you’re looking to decrease the production time at your factory.

BMW, among other automakers is looking into modular wire harnesses. This would require less semiconductors and cable which would make them lighter and save space, according to an individual with knowledge.

As they are not permitted to make public statements, the anonymous source said that wireless vehicle upgrades will be easier using new harnesses. That is where Tesla dominates.

CelLink, an American startup, developed a flat-and-automatic “flex harness”, which is easy to install and has raised $250 million from various companies, including BMW and other auto suppliers. Lear Robert Bosch (NYSE:) Corp

Chief Executive Officer Kevin Coakley refused to identify the customers but stated that CelLink’s harnesses have been installed in more than a million EVs.

Tesla is the only carmaker that can achieve this scale. However, Tesla did not reply to our request for comment.

Coakley explained that CelLink’s Texas $125 Million factory will include 25 automated production lines. They will switch designs between the different models in just 10 minutes, as they are made from digital files.

He said that the company was working with a variety of carmakers to develop EVs and is looking into building another European plant.

Coakley claimed that his company can ship new products within two weeks of changing an existing wire harness. This is despite the fact that it takes up to 26 week for a standard wire harness to be changed.

This kind of speed is what legacy carmakers want as they move to electric vehicles, according to Dan Ratliff who is a principal at Fontinalis Partners in Detroit, which was established by Bill Ford, and has also invested in CelLink.

Ratliff stated that for many decades the industry didn’t need to react quickly to change a part such as the wire harness. But Tesla changed all of this.

On the EV side it’s simply go, get, go.