W&WP May 2003

Growth Opportunities Open Up for Window & Door Industry

Studies predict U.S. window and door sales to grow approximately 5 percent annually over the next few years.

By Karen M. Koenig

Despite a slight decline in housing starts being predicted for 2003, the prospects for window and door sales continues to look promising.

According to a report by The Freedonia Group, the U.S. window and door industry is projected to grow 4.9 percent annually over the next five years, to $31 billion. The study, entitled Windows & Doors, states that "increases in average home sizes and the growing use of value-added products" will offset the effects of a soft housing market.

U.S. Window & Door Demand

(in million dollars)
%Annual Growth
Item 1997 2002 2007 1997/02 2002/07
Total Demand 18,370 24,500 31,050 5.9 4.9
Wood 7,810 10,370 11,900 5.8 2.8
Metal 8,290 9,780 12,950 3.4 5.8
Plastic 2,270 4,350 6,200 13.9 7.3
Net Imports 140 900 1,650 45.1 12.9
Shipments 18,230 23,600 29,400 5.3 4.5
Source: The Freedonia Group Inc. (Cleveland, OH)

"Everyone remains cautiously optimistic for 2003," said Alan Campbell, CAE, president of the Window & Door Manufacturers Assn. "All indicators still point to a solid housing market, even if it declines slightly from its record levels in 2002. We do expect that commercial and non-residential construction will remain in a stagnant mode for the year."

U.S. Outlook Positive

Even with the slight decline predicted for new housing, the outlook for the window and door industry remains optimistic due to the continued growth of the remodeling and replacement market.

According to the WDMA's Statistical Review & Forecast, out of the 59.1 million units of windows shipped last year, 13.4 percent more windows were used in remodeling and replacement applications last year (31.4 million units) than for new construction (27.7 million units). This trend is predicted to continue for the next few years, with 17.5 percent more growth expected by 2006 for the remodeling market (34.3 million units of windows), compared to new construction sales (29.2 million units).

Vinyl is expected to continue its dominance in terms of market share, particularly in the remodeling market, where the WDMA says it outsold wood products by 58 percent in 2002.

"Vinyl (PVC) actually surpassed wood a few years ago," says Campbell. "There were several factors driving its rapid growth, primarily ease of maintenance."

However, wood seems to be the preferred material for new construction. According to the WDMA's report, wood window units outsold vinyl by 31 percent in 2002 in that sector, and is predicted to continue its dominance over the next few years.

Wood is also the preferred choice for residential passage doors, accounting for nearly 100 percent of the market, the report says. For residential entry doors shipped in 2002, steel was used in 66 percent of the applications, with wood accounting for 22 percent and fiberglass representing the remaining 12 percent.

For non-residential passage doors, the report says, wood was also the top choice in 2002; out of 7.3 million units shipped, wood accounted for 40 percent of the market. In entry doors however, out of 3.3 million units shipped in 2002, steel accounted for slightly more than half the market, with aluminum at 33 percent and wood at 6 percent.

In looking at the industry from a monetary standpoint, wood windows and doors outsold plastic by 138 percent last year, $10.4 billion compared to $4.3 billion. By 2007, Freedonia says, that percentage is expected to decrease to 92 percent, with wood at $11.9 billion and plastic at $6.2 billion. Metal, it says, will surpass wood as the top selling material by 2007, although most of the $12.9 billion will be due to sales of exterior doors.

Out of the $24.5 billion market in 2002, imports accounted for $900 million, Freedonia reports. Imports have had a greater effect on doors than on windows.

"The wood door industry has been greatly affected by large imports of residential wood doors from overseas," says Campbell. "In many cases, these doors have a competitive advantage because of lower raw material costs and labor costs at their point of manufacture. Much of this competition has actually been coming from the Far East and South America.

"Windows, on the other hand, are much more sophisticated in terms of their manufactured components, particularly glazing and hardware.With the exception of Canada, we see very little volume of windows imported into the U.S."

Canada Sees Similar Trends

The Canadian window and door market, it seems, is generally following in the footsteps of the United States.

"The housing market in Canada was extremely strong in 2002 (200,000-plus housing starts, up from approximately 165,000) - the best it's been since the mid-1980s," says Tom Duffy, business development officer, for the Canadian Window & Door Industry.

The remodeling and renovation market has also been extremely strong, Duffy adds."It's all very good, and the potential for the window and door market this year is also looking very good."

Material trends, particularly for the window market, are also similar to that of the United States. "Solid vinyl currently accounts for approximately 65 to 70 percent of window sales. If, on top of that you add vinyl clad, it climbs to 75 to 80 percent," Duffy says.

Contributing to vinyl's growth are its low maintenance - particularly in regards to finishing - and cost. However, unlike in the United States where regional weather conditions often influence material preference, Duffy says that vinyl appears to be "very strong across the whole country, from east to west."

Wood, however, is the material of choice in high-end installations. Duffy says that architects often prefer wood because of its "warmth" and aesthetic appeal.

European Outlook Shows Little Growth

Like its North American counterparts, the European window and door industry is expected to increase slightly in 2003, to 101.5 million window units. This follows two years of stagnation at 100.5 million window units, according to Eike Gehrts, technical project manager with EuroWindoor, the organization which represents the three sectors of the European window and door industry: the Federation of the European Window and Curtain Wall Assns., the Federation of the European Associations for Building Joinery and the Federation of the European Plastic Window and Door Manufacturers.

Aiding the growth, Gehrts says, is the trend in Europe toward customization, i.e., manufacturing to order and single lot sizes. "Furthermore, a lot of regional factors influence the window and door markets. In central and northern Europe, energy efficiency is the key issue, whereas for instance in southern Europe, building style and traditions play a key role."

Very little product - only about 10 percent - is exported, he adds. "The European window market is typically a regional market. Only a very few producers operate on the national or European scale. The latter are typically the big system houses providing the market with system solutions for PVC and aluminum windows."

Because of its low price - "it's about 20 percent less than wood frames" - and convenience, PVC continues to be the dominant material used in European window frames, Gehrts says. It is used in approximately 42 percent of the products, followed by solid hardwood and wood clad products, at 33 percent. Because of the climate in Europe, softwoods are not used for exterior parts.

Legislative & Standards Updates

California Law Puts Burden on Manufacturers

Window and door manufacturers are keeping a wary eye on California following the January passage of SB800 which governs construction defects. As it is currently worded, SB800 puts burden on the product manufacturer, including cases where the wrong product is specified or is installed incorrectly. The law also sets new functionality standards for windows.

The Window & Door Manufacturers Assn. and American Architectural Manufacturers Assn. are just two of the many industry groups working to change the language in the law. "The WDMA is working aggressively to correct certain elements within SB800 which placed an undue burden on building products manufacturers.. We consider this to be our legislative priority," said Alan Campbell, CAE, WDMA president.

North American Fenestration Standard Updated

The next version of the North American Fenestration Standard for windows, doors and unit skylights is available for review. According to the Window & Door Manufacturers Assn., changes in 101/I.S. 2/A440-XX from its previous version include:

* The addition of side-hinged exterior doors

* A limited water rating for side-hinged doors

* Hardware water testing and vertical load testing of doors

* New sash, frame and glazing material requirements

For a copy of the specification, visit www.wdma.com/information/. It is targeted for inclusion in the 2006 version of the International Building Codes.

Single European Standard Announced

North American manufacturers may soon have an easier time selling their window and door products in European countries. A single European product standard for the testing and classification of products, similar to AAMA/NWDA 101/I.S. 2 in the United States, has been developed by EuroWindoor, an organization made up of the three sectors of the European window and door industry: the Federation of the European Window and Curtain Wall Assns., the Federation of the European Associations for Building Joinery and the Federation of the European Plastic Window and Door Manufacturers.

The standard will be published by the European Standardization Organization under the title EN 14351 for windows and external doors and EN 13830 for curtain wall. It is at the formal voting stage and should be implemented during the next 12 months, said Eike Gehrts, EuroWindoor technical project manager.

According to Frank Koos, EuroWindoor deputy general secretary, the standard is designed to be both materials neutral and performance based. In order to carry the CE mark, products must be tested, and their performance recorded, for wind resistance, fire safety, watertightness, acoustic insulation, thermal resistance and radiation properties, air permeability and impact resistance for doors.

The standard would also establish voluntary tests and classification ratings for seven other categories, including: operating force, mechanical strength, ventilation, bullet resistance, explosion resistance, mechanical durability and burglar resistance.

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