Focus on German Glass Industry

Focus on German Glass Industry

The German glass industry achieved to increase its sales figures in the past year owing to high growth rates in the first two quarters, despite the generally weak economic situation, whose effects influenced also the glass industry.

Export as economic situation booster
The industry could increase its transactions in 2000 compared to the previous year by 4% to 8.8 billion €. This growth was above all the result of a considerable rise of the exports which, owing to a plus of 12,7% reached a new record value of 3,7 billion €. However, with a plus of only 1,6% to 5,9 billion € the development of the inland business remained clearly behind the export figures which went up within all product ranges.

The German glass industry comprises over 440 industry enterprises, employs about 65.600 employees and supplies its products to more than 200 countries world wide. The most important part of the industry - with a portion of 33,7% of the total production value - is the flat glass treatment and refinement. The field of customs and special glass (including hollow glass refinement) constitute 20,5%, container glass 17,2% and mineral fibres 12,8%, completed with the fields of flat glass production with 9,5% and crystal and house hold glass with a part of 6,3%.

Largest customer market with a portion of 35% of the production value is the construction industry, followed by the food- and beverage industry (15%), the automobile industry (12%), the electro- and electronic industry (8%) as well as households and hotels (8%).

Smaller markets are medical industry, research and science with 6%, chemistry, pharmaceutical and cosmetic industry (5%), furniture industry and interior design (5%), plastics and textile industry (5%) and other applications (3%).

Although some sectors encounter troubles, specially in the field of container glass, the German glass industry could further improve its consolidated competitiveness in 2000 owing to the obtained growth. Ruling part of this development were the export trades. The industry was able to increase the turnover with abroad – favorized by the currency development – by 9,3% to 3 billion €. Consequently, the share of export trade at the total turnover was increased to 41,9% compared to 38,6% in 1999.

The import figures of 2000 increased even more in percent than the exports, this above all caused by the sectors automobile glass, special glass and technical glass. Imported glass products reached a value of 2,8 billion €, which were 17,9% increase and which come up to a share of 32,3% of the inland market (previously 29,2%). The import of goods specially from USA (+64,4%) and from Asia (+52,5%) increased considerably, whereas the imports from countries of the EEC increased only by 7,3% and those from Central and Eastern Europe by 10,1%.

2001: Growth owing to high export in the first two quarters
Alike in lots of other industries, the development in the past year was quite mixed. After strong beginning early 2001, growth of the glass industry became distinctly weaker within the course of the year. According to preliminary figures, in 2001 the industry obtained a plus of 2,1% to reach 9.005 billion €, specially owing to the high growth of export figures in the first two quarters.

Export lost its dynamic development in the second half of 2001 and compared to same month in the previous year it does not reach its level. But owing to the increase in exports in the first quarter of formidable 15%, this industry could increase its export figures calculated for the whole year by 4,3% to 3.045 billion €. In contrary to the export, glass industry did not register any weakness in the continually retaining inland market. According to estimations, inland figures increased by 1,1% to about 6 billion € in 2001. However, with very different tendencies: whereas flat glass and special glass could encounter higher inland figures, container glass had to register a reduction of 3%, which, however was compensated by far by the growth of export.

Hope of vitalisation in the second half of 2002
Facing the actual economic situation, the industry experts give only cautious outlook for the year 2002. Expecting only modest sales figures for the inland, the glass industry is expecting trade figures for 2002 that are below the figures of the past year. As indicator for this development the tendency in orders for this industry can be taken. End of 2001, the value of order entries has missed the past year level by 1,6%, and not only inland orders (-1,4%) but also export orders (1,9%) were regressing. This signifies that securing the growth by exports, as it has been realised in the past year, will be difficult. Should the prognosis of an economical increase in the second half become true, the perspective of growth which are connected herewith will have a positive influence for the whole industry.

The inland business is strongly influenced by the development in the customer industries of the glass industry. Boldly said, about a third of the business of the glass industry depends on the construction industry, a further third depends on packaging. In this field, there are partial positive developments – such as for wine and food industry – but also structural difficulties. So in those beverage segments that are in competition with PET. The remaining third depends on investment politics, the development of which can hardly be foreseen at the moment.

Chances with High-Tech
Whereas the glass industry standard sectors further depend on the development of the general economy and respective customer industries, in special sectors there are new possibilities for the application of glass and glass products. Important chances are expected in the so-called high tech segments, such as the application of special glass. Such a prospective market for example is the technology of glass chips which are no more designed with metal alloys but on special glass. However, no large quantities are to be expected, but the achievable high margins promise good profit.

Alike outlook is valid for the market of insulation glass. Standard glazings do not offer high profit due to the large competition in this field. But with special coatings, high profit can be achieved. Example for this are the electro-chromous or gas-chromous glazings and also water repellent or water attracting coatings for the self-cleaning effect.

A perfect opportunity to achieve information about the glass industry such as stand of the technique, trends and medium-term developments is next glasstec 2002 from 28.10.-1.11.2002 in Düsseldorf.

Source: Ogis GmbH – www.glassglobal.com, Glass Ingenieur – www.glassnet.de