Grappling with Rising Glass Costs
Summer 2022 has brought high temperatures right alongside higher prices for everything from gas to groceries, and yes, to glass. As of May 2022 (the latest data available at press time), the Producer Price Index for flat glass was up 22 percent over two years. The flat glass PPI should show another jump in its June and July readings following 40 percent price increases on some float glass products announced by two domestic manufacturers in June.
Glass Magazine’s top industry blogging voice, Max Perilstein, owner of Sole Source Consultants, covered the announcements—the first from Guardian Glass, and the second, one week later from Vitro Architectural Glass—providing perspective on the initial industry reaction to the increases, along with potential industry-wide impacts.
“The psyche of our industry right now is fragile. The back-to-back blows … [have] people from companies of all sizes freaked out,” said Perilstein in his June 19 From the Fabricator blog. “These increases and the way they are being implemented are extremely hard on all makes and models. The bigger companies have the most exposure, tons of long-term commitments to work through. The smaller have issues getting materials as is and don’t have the deep pockets to ride things out.”
The blogs elicited dozens of responses and questions from industry officials in all sectors. Will the increase lead to less glass on buildings? Are project cancellations coming? Will imports increase? Are the hikes overdue after decades of price stagnation? Will smaller companies have a tougher time getting glass?
Response from the industry
A tough 2023
“This news is truly unfortunate for so many of us; these substantial increases will have massive ripple effects in the industry. It is very frustrating and will significantly contribute to a very tough 2023 for all, especially the smaller companies,” said Syndi Sim, vice president, marketing and business development, Diamon-Fusion International.
Bad news for the small guys
“It is extremally concerning for us smaller companies who are price locked into projects so far in advance and cannot do anything to [alleviate] the increases quickly. Just as we are trying to bring more manufacturing back to our plant, this will 100 percent push companies to imports, as we all have to do what we must to survive,” said Kevin Roth, CEO and founder of Privacy Glass Solutions, powered by Vistamatic.
Continuous production problem
“Float glass producers have struggled forever in the down economic periods. The continuous production of float glass makes it tough in down cycles and a lot of money is lost (running full pull, building big inventories to keep cost down, then selling at a loss to keep the warehouses from bursting at the seams). It is hard to recover when the economy improves,” said Gus Trupiano, national sales manager, specialty products, GGI.
More value engineering
“Unfortunately, you will certainly see the use of glass shrink in scope on projects. Hello number one [value engineering] option,” says Brad Holt, vice president at Element13 Facades.
A resilient industry
I’ll close out with an excerpt from Perilstein’s blog on June 26, looking at how glaziers and fabricators in the weeks following the increases. “People sat down and worked through it. Battled. … We did see intelligent and creative work from so many to work through this the best way they could,” he wrote. “We can’t just hide under the covers. We have to figure it out and deal with this hand. Kudos to every sales manager or estimating head who had to make those phone calls, re-work quotes, and deal with the confusion and turmoil. There was a ton, and you dealt/are dealing with it. Good on all of you.”