Volume 40,   Issue 6                                 June  2005

NewsNow

Cardinal Glass Breaks Ground on
New Float Plant in Washington State 

Cardinal Glass, headquartered in Eden Prairie, Minn., broke ground in Winlock, Wash., for what will be its fifth float glass plant. According to a www.businessexaminer.com report, the $130 million plant is scheduled to open in August 2006. It will be 550,000 square feet and located on 89 acres, employing 220 people and producing 650 tons of glass a day.

The report also said Cardinal had leased nearly 12 acres from Port of Olympia next to its coated glass plant in Tumwater, Wash. There, Cardinal plans to build 140,000 square feet of warehouse and staging space.

Glass Manufacturers and Suppliers 
Trade Fuel Surcharges for Price Increases

Most primary glass manufacturers increased the price of glass 3 percent last month, rescinding the diesel fuel surcharge previously announced. Companies raising their prices included AFG Industries, Guardian Industries PPG Industries and Pilkington North America. 

According to a senior official at one of the primary glass manufacturers, who preferred not to be identified, all the glass manufacturers are doing is passing along the costs trucking companies are imposing on them. The source expects their customers (distributors and fabricators) will in turn pass along the increase to their customers. 

“In the glass industry, the primary glass manufacturer pays for delivery,” he said.

“Since this has been going on for several years, and all the parties understand about the rising fuel costs, the system has been accepted,” he explained. “But anyone would have to be careful to deviate from what has become accepted, because then the question of price gouging would come into the picture.”

On the supplier side, the Industry Division of Sika Corp. of Madison Heights, Mich., also increased its prices to adjust to the continued escalating costs of a number of raw materials required to produce its adhesives and sealants. 

According to Ron Smith, director of marketing, glass companies will see a 5- to 10-percent increase. 

“We’re still looking at the final numbers,” said Smith. “We’re the same as all the other companies that are buying raw materials. The costs keep going up and we’ve eaten as much as we can because it’s a very competitive environment,” he explained. “But at this point, we felt we had to make this move.”

Previous price adjustments have not recovered supplier cost hikes that are expected to persist throughout the remainder of the year, the company stated in announcing the move. 

“It is no secret that petroleum-based raw materials, energy and transportation costs continue to rise. We remain committed to offset some of these costs with productivity and technology improvements, and by simply absorbing other costs. However, we have to pass on some portion of the most recent increases in order to maintain the performance integrity of our products and profitability targets for our shareholders,” said Bill Pringle, the division’s senior vice president. 


USG
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