G3: Industry insiders talk glass

Commercial

Diana Perreiah, general manager, Kawneer North America, and vice president, Alcoa Building and Construction Systems

“We have already seen evidence that the industry will be consolidated post-downturn with the recent C.R. Laurence acquisition of U.S. Aluminum, Kawneer’s acquisition of Traco and others we are all familiar with. We are also likely to see a greater emphasis placed on designing and constructing smart buildings—expanding on the trend toward ultra thermal and energy efficient products. This also includes sun-control products and photovoltaic systems. Dynamic glass may also offer significant growth opportunities as manufacturers explore electrochromic and thermochromic technology.”

Retail

Rod Van Buskirk, president, Bacon & Van Buskirk

“We’re a full-service business in Central Illinois and West Central Indiana. Locally, we do retail, residential and commercial service work. Regionally, we do wholesale and contract glazing.

I hope we see a return to a booming economy sometime soon, but I believe we’ll more likely remain in a long-term, flat, ‘slow growth’ economy that will last for years. Overall, I think the commercial and residential fenestration industry will continue to shrink until the economy begins to grow again …and that may not happen for some years to come. The lack of domestic demand, coupled with the overcapacity in glass and metal production, will continue to push consolidation and closing by manufacturers. More fabricators and glass houses will close in states with no or slow growth. When the economy does begin to really grow again, I don’t think you’ll see ‘irrational exuberance’ and ‘fast growth’ occur as we did before. Growth activity will be more measured. National debt will restrain us in the U.S. The big action will be overseas, since they’ll have the money. Domestically, you’ll see continuing interest in energy conservation products. Hopefully, dynamic glazing products will reach an affordable price point by that time and not require subsidies.”

Fabrication

Nick Sciola, president and owner, Hartung Glass Industries

“There will be fewer locations for all tiers of our industry. The window and door industry is probably the best example of that right now. The exceptions are [the] float companies that have the ability to sell internationally. If you can export, you have some opportunities that we don’t currently have nationally. There also seem to be two ends to the spectrum with regards to products: low price vs. high end. Companies must decide if they are going to service both—which is very difficult—or if they are going to go after the very high end with specialized, value-added product. The middle has disappeared.

One of the largest threats to the industry is that margins continue to suffer as all sectors chase lower demand than needed to satisfy capacity levels. We’re seeing some stability going through the summer in smaller volume projects; however, the larger projects seem to be under more margin pressure. As we enter into the first quarter of 2012, we don’t want to repeat the unexpected decline in volume that we saw in the first quarter of 2011.”