The bright spots
During the National Summer Conference for the American Architectural Manufacturers Association last week, I was reminded of the terror of Minnesotan summer mosquitos and of what 100 degree heat plus humidity feels like. And, more importantly, I was able to sit down for a productive interview with AAMA President and CEO Rich Walker. Walker provided some interesting insights about how 2011 is shaping up for AAMA members, the bright spots in the market, and details about how companies are dealing with challenges such as the Environmental Protection Agency's new lead paint regulations.
Watch video of part of the interview. And for more from the interview, check out the Q&A below.
What are the top concerns you're hearing from your members in the commercial segment? What about from the residential segment?
For residential, I'm hearing concerns about the lead remodeling rule, and in general, the business environment and future prognostications. The market is facing lingering foreclosures, and we have to work those foreclosures out of system before we can see a true rebound. I don't think we'll see a light at the end of tunnel for two to three years for the residential segment. Additionally, our residential members are terribly disappointed with the new tax credits that were passed [for 2011]. We were hoping to get something similar to the $1,500 to $3,000 tax credit [of 2010]. People were called back to work when those larger credits were in effect.
Our commercial members are very pleased to learn of the ruling from the Department of Commerce that assigned dumping duties on Chinese [aluminum] extrusions. Early indicators are proving this was very effective and positive for our members, and those dumped aluminum profiles have pretty much disappeared. However, our commercial members are also concerned about EPA lead regulations, as there is discussion about extending them to commercial buildings. This is currently under comment and evaluation by the EPA.
What are the top product trends in the market?
One primary product trend is the continued focus on energy efficiency. Universally, everyone is looking into energy. Energy Star is evolving. And, additional panes of glass will continue to be investigated. Triple pane is becoming more accessible and more visible in the market. In time, we will also be looking at a fourth pane. This is evolving very quickly.
When the construction industry final rebounds from this great recession, how will the glass, and window and door industries have changed?
We will have fewer manufacturers and fewer suppliers. I haven't seen a drop off in mergers and acquisitions. Additionally, over this time, while business in down from historically high levels, companies have looked inward to focus on how to do things quicker [and] become leaner. The supply chain is going to come out very productive and lean when [the market] begins to ramp up. We're also seeing things change competitively in terms of China. Chinese labor is becoming more competitive, as their labor costs get higher. So, the difference between the Chinese cost of product and the North American cost of product has narrowed. One final thing to keep an eye on is gas. These high gas prices will change the industry.
Devlin is senior editor for Glass Magazine. Write her at firstname.lastname@example.org.