You may have heard Smokey Yunick talk about maintaining high exhaust velocity and increase scavenging by covering headers with a thermal wrap. In addition, there are companies that coat headers with a thermal barrier, typically some type of ceramic formula, in order to keep the heat inside the exhaust system. Stainless steel performs this function without the need for add-ons because it has a much lower coefficient of thermal conductivity, thereby keeping more heat inside and transmitting it to the header outlet. Radiated heat is perhaps the most important reason to wrap or ceramic coat the headers to protect the car and the driver from excessive, fatiguing high temperatures.

Typical 1010 carbon (mild) steel conducts 219% more heat per foot than do the types of stainless steel we use in header fabrication. By contrast, quite a bit more heat stays inside the stainless header tubes and does not get passed into the surrounding air. By not allowing the contraction of the cooling gases as they flow down the tubes, more exhaust velocity is retained which promotes better scavenging at the collector. This retention of velocity increases the overall header efficiency.

You've probably seen Indy cars with their enclosed engine compartments and thermal clam-shell enclosures around their turbocharger headers. They must thermally wrap their exhaust pipes just so the radiant heat off the tubes won't cause fires or melt any critical systems. In this case headers made out of mild steel would completely fail and break apart due to the severe heat retention, let alone scale and send death particles into the turbocharger, ruining the turbine blades. 321 stainless steel has excellent high temperature fatigue resistance in this enclosed application and does a darn good job of living in this hostile environment better than any other material except the ultra-high nickel content steels ( such an Inconel ), which are hard to find, very difficult to work with and extremely expensive.