Volume 9, Issue 2 - February 2008
Celebration Time? Not at All
Though it was time to gather with peers, there didn’t seem to be much too much reason for celebration. After all, attendees of the Window and Door Manufacturers Association annual meeting, held January 26-30 in Palm Beach Gardens, Fla., were told the following:
There were a few bright spots. If you’re a fiberglass manufacturer, your market share will continue to grow. If you’re a WDMA member, at press time a major announcement regarding moving the association forward for future growth was forthcoming. And, a new concept, Building Information Modeling, is the big trend hitting the construction industry.
“This is one of the largest price increases in recorded history,” he said. Why? “Beats the hell out of me,” he said in a statement repeated several times throughout his presentation.
“People who say they know are lying,” said Cato, who told attendees not to listen to the energy forecasters.
“Energy forecasting is horrific. They have been jaw-dropping wrong,” said Cato. “If past is prologue, we will see a jaw-dropping decline in price.”
Those who are worried about high oil prices being an indicator of the economy shouldn’t worry, according to Cato.
“The conventional narrative about how high oil prices tank the economy is wrong,” he said. “If you would have asked economists what would happen if oil went from $26-$100 a barrel they would have said ‘a steep recession.’ This didn’t happen.”
Cato also addressed the energy crisis, and singled out the items he believes will not provide any solutions to it. This includes nuclear power as Cato said the costs to build these new plants are huge. He said the same for renewable energy alternatives, and then went a step further. “Reducing greenhouse gas emissions will increase prices,” he said. “Protecting the environment and reducing prices are at odds,” he says. “The two don’t mix.”
At the conclusion of his presentation, one participant asked Cato what he thought about government guidelines regarding energy.
“I hate them. I’m an old fashioned guy. If people want to build an efficient building, let them. If I want to pay high energy costs for my house with high ceilings, that’s my right.”
He added, “I’m happy to see green labeling so consumers get a good picture of what they are buying, but beyond that I don’t agree with it.”
Litigation—How Not to be a Target
Smith points out that window manufacturers are more at risk than those who make doors. Smith offered valuable tips regarding what companies can do to make themselves a less desirable target. These includes:
BIM—a Groundbreaking Model
“This is the biggest change our industry will go through in our lifetime—no doubt,” Jones told attendees. BIM is a database of physical and functional characteristics of a facility. “It’s the most current set of DNA for a building,” said Jones.
Through the BIM model, parametric objects can understand their relationships with other objects. “This eliminates a lot of dumb mistakes that get made,” Jones said. For the door and window industry, the timesaving advantages of BIM are huge. “You can put in a certain set of windows and get an energy calculation,” he said.
“This used to take weeks.” The model also may be used for existing facilities.
“You want your products being pulled into these models,” said Jones, who told attendees that the tipping point for BIM will come in 2008. (To view the presentation, visit www.wdma.com.)
From Green to Gold
He pointed out how Toyota is known as the innovative leader in the automotive market, and how door and window manufacturers can follow this example.
“If you do this in the window industry, it will make your brand,” he said. Winston warned attendees, however, that if they introduce green products they better make sure they are actually green. He also told them to not be afraid to set big targets as the companies who do this are the ones who enjoy great success.
Ducker Releases Preliminary Forecast Data at WDMA Meeting
Some of the statistics were no surprise for door and window manufacturers, who are all too familiar with the dramatic decline in housing starts.“2007 marked the worst residential construction slump in decades,” said Shober. “But it was a banner year for non-residential.”
He reported that single-family starts declined 28.6 percent, and projects another steep decline in 2008.“The outlook is rough for 2008 …. Certainly we are all anxious for 2009 to get here,” he told attendees. For the residential window market, following is how the individual materials fared in 2007: vinyl—57.7 percent; wood—27.1 percent; aluminum—12 percent; and fiberglass—2 percent. “There was a little gain on share for wood—a little decline for vinyl,” said Shober, though he added that vinyl has gained slightly on the remodeling side.
Other trends noted: The average home size is leveling off. And on the remodeling side, as a whole the market will double in 2008, but the door and window market won’t fare as well as other remodeling markets, he said.
Shober offered some additional preliminary statistics, including:
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