Demand at an All Time High
The time to upgrade your skylights is now, Puget Sound! The glass industry is currently facing a major problem: too much demand! Warren Willoughby, CEO of Sound Glass, stated “We’re having growing pains. The economy growing, but there is a limited amount of glass that can be manufactured nationally.” Glass companies are now anticipating their busiest year since before the recession, and economic analysts are predicting a 16% increase in construction expenditures and a 17% increase in construction in 2015.
Interestingly, this has not been the trend in previous years. In fact, between 2006 and 2014, 11 glass manufacturing plants closed down, reducing the nation’s total glass making capacity by 23%. Industry experts estimate that the remaining plants will be running at a capacity in the high 80’s and low 90’s during peak times, which would cause prices to skyrocket. Why aren’t new plants being built? The initial expenditure needed is 350 to 400 million along with the necessity for the plant to run 24 hours a day, seven days a week, and 52 weeks a year. Without a crystal ball that assures that demand will keep rising for the 15-20 year lifetime of such a facility, business owners are weary of investing so much in a hazy looking future. The price of glass has been steadily rising for last couple of years and Mike Campbell, CEO of Tacoma Glass, remarked that currently, prices are “a good 15 to 20 percent” higher. He predicts they will rise another 10-15 percent over the next two years. “It’s pretty big for what you would consider a commodity, a raw material,” he said.
The Effect on Owners
This predicament puts businesses in a tough situation. There is a chance of quoting a job at one price and then having the price of glass go up. Since some jobs take a year or so to mature, this poses a large threat to glass industry participants. It’s not all bad news however. Willoughby states that “It will initially impact you negatively, but will smooth out as the jobs in the bid cycle get turned over. If you make a 20 percent margin and the price is higher, you’re making 20 percent of a bigger number. If the price is passed on in a timely manner to the consumer, it can be good for the business.” Campbell, on the other hand, is worried about the future and thinks this trend plagues the glass industry with extra steps and considerations. “It’s definitely a negative,” said Campbell. “It requires a lot more attention from a purchasing standpoint to forecast and plan further out in the future than we’re used to , and actually we’re even having to bring in standard glass from overseas at a higher cost because we cant get enough in the U.S.” We wish luck upon all of our friends in the glass industry during these changing times!
Here at Chase Construction North West Inc., we not only specialize in roofing but have expertly installed Tam® skylights for over 13 years. We pride ourselves on being honest and professional in all aspects of our business and we want to show you today Puget Sound! We work hard to give our customers the most value. Our customer review sites speak for themselves! Let us show you why we’re the ones for the job at one of our free estimates! We provide services in King County and Pierce County, along with major cities such as Seattle, Tacoma, Puyallup, Federal Way, Renton, Auburn, Des Moines and all of the surrounding cities. If you are in need of roofing, decking, waterproofing, or skylight installation services contact Chase Construction North West, Inc. today. Fill out our free estimate form or call us today at 253-445-8950.