Urethane Foam Manufacturing in the US Industry Market Research Report from IBISWorld has Been Updated

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Following steep declines during the recession, a revival in the automotive and construction sectors will help bring the industry back to growth. For these reasons, industry research firm IBISWorld has updated a report on the Urethane Foam Manufacturing industry in its growing industry report collection.

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The hurting housing and automotive industries greatly reduced demand for foam products

The Urethane Foam Manufacturing industry is bouncing back readily from the depths of the recession. According to IBISWorld industry analyst Nima Samadi, “this industry was previously driven by strong performances in its downstream markets, such as the housing and automotive sectors.” From 2007 and 2009, however, nearly all industry market segments contracted, hampered by the economic downturn. Since then, industry revenue has slowly recovered as downstream demand has strengthened, boosting industry revenue an estimated 9.7% and 2.4% in 2010 and 2011, respectively. Though this upward trend is anticipated to continue in 2012 with a 2.6% jump, revenue is estimated to decline at an annualize rate of 4.1% to $8.6 billion in the five years to 2012.

The Urethane Foam Manufacturing industry is heavily reliant on a variety of industries to purchase its products. The meltdown of the housing market and the subsequent reduction in demand for construction and renovations resulted in considerably less cash from construction-related foam purchases, including insulation and carpet cushioning. “Because the furniture manufacturing sector, which purchases foam for furniture cushions, mattresses and pillows, is largely driven by the housing and construction markets, its poor performance during the recession also led to a drop in demand for industry products,” says Samadi. Meanwhile, the collapse of the domestic automotive industry in 2008 and 2009 caused demand for new cars to plummet, which in turn reduced demand for foam used in automotive seats and other interior products. However, the automotive sector experienced an aggressive recovery in 2010 that has continued into 2011 and 2012, resulting in a rebound in this market's foam purchases.

Over the next five years, research and development for foam as a substitute for other materials will continue to provide opportunities for growth in a number of market segments. As the economy continues to recover, foam manufacturers are expected to experience the impressive level of revenue growth they achieved before the economic downturn. This recovery will be punctuated by robust activity in the motor vehicle manufacturing and construction sectors during the five years to 2017. At the same time, industry concentration is forecast to increase, albeit slowly, as companies make a concerted effort to increase profitability by claiming larger portion of market share. Through the industry currently consists of a large number of small firms, a number of key acquisitions are expected to take place, helping companies build economies of scale. This will be difficult, however, as facilities are typically spread over several states to mitigate transporations costs associated with shipping industry products. For more information, visit IBISWorld’s Urethane Foam Manufacturing in the US industry report page.

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IBISWorld industry Report Key Topics

This industry comprises establishments primarily engaged in manufacturing plastic foam products (except polystyrene). These products are used to insulate objects or reduce shock. Plastic foam products are used in bedding, packaging, seat cushioning, carpet cushioning, car interiors, fluid filtration systems, antinoise and vibration systems in aircraft, medical devices, and a number of consumer applications such as sponges, mops, paint brushes and cosmetic applicators.

Industry Performance
Executive Summary
Key External Drivers
Current Performance
Industry Outlook
Industry Life Cycle
Products & Markets
Supply Chain
Products & Services
Major Markets
Globalization & Trade
Business Locations
Competitive Landscape
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
Major Companies
Operating Conditions
Capital Intensity
Key Statistics
Industry Data
Annual Change
Key Ratios

About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.

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