The collapse in the housing market and commercial construction has hurt demand
Los Angeles, CA (PRWEB) July 11, 2012
From building facades, skylights and walkways to revolving doors and room dividers, architectural glass enables designers and architects to create distinctive looks for commercial and residential buildings. The Architectural Glass Manufacturing industry provides a wide variety of glass products that have different aesthetic and performance uses and that also meet specifications for heat, energy-efficiency and lighting requirements. Although the use of architectural glass is prevalent across most building markets (e.g. office buildings, hospitals, schools, retail spaces and condominiums), the significant drop in construction activity over the past five years, hindered the industry's performance, says IBISWorld industry analyst Andrea Alegria. As such, industry revenue is expected to decline at an average annual rate of 7.7% to $1.96 billion in the five years to 2012.
According to Alegria, "The market for architectural glass in the United States is mature and moves in line with US residential and commercial construction. The total collapse of the housing market and the subsequent impact on commercial construction curtailed demand." Revenue declined from 2007 through 2010, dropping by as much as 26.9% in 2009 during the peak of the recession. Exports represent a decent share of the Architectural Glass Manufacturing industry's business, but it also faces a significant level of competition from imports. As a result of the drop in demand and deteriorating profit conditions, industry players have implemented a number of cost-control measures, including workforce reductions, divestment of underperforming business operations and adjustments in manufacturing capacities. As a result, the number of firms and jobs has declined from 57 firms and 8,067 employees in 2007 to about 46 firms and 7,070 employees in 2012. Asahi Glass Company Limited, Compagnie de Saint-Gobain, PPG Industries and Apogee Enterprises are currently the industry's major players, and they contribute to it's high market share concentration. Because of their stronghold on the industry, they have maintained market share over the past five years, despite falling revenue. Company acquisitions have also allowed these players to remain at the top by expanding their market presence domestically and globally, through a variety of product lines. Furthermore, continuous investment in research and development has enabled these operators to introduce innovative products and corner smaller players out of the industry.
Following modest improvement in 2011, the industry is expected to grow over 2012, in line with economic recovery and gains in US construction spending. Revenue growth will be subdued by the slow pace of recovery in the commercial construction markets; however, rising demand for energy-efficient architectural glass will help propel the industry forward. Design innovation and new applications for architectural glass will also alleviate competitive pressures and profit will improve. For more information, visit IBISWorld’s Architectural Glass Manufacturing in the US industry report page.
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IBISWorld industry Report Key Topics
This industry manufactures flat glass for use in architectural applications. The industry includes glass products that are used for external walls and internal partitions made in glass making plants, as well as products made from purchased glass. This industry does not produce mirrors, windows or doors made from purchased glass.
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