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In 2013, revenue is expected to increase 2.9% to $24 billion as the glass product manufacturing industry benefits from the recovery in residential and commercial construction markets, and a boost in consumer spending. However, growth in the industry will still be limited by persistent product substitution and import penetration, according to an updated report from IBISWorld.
“Industry sales steadily declined since the late 1990s, but this trend accelerated due to a drop in construction activity and consumer spending following the recession,” said Stephen Morea, industry analyst. As a result, revenue declined at an estimated annualized rate of 1% to $24.0 billion during the five years to 2013.
The steady contraction in the domestic glass manufacturing industry is also the result of imports capturing a greater share of the domestic market and partly due to the substitution of glass container products by alternative packaging materials like aluminum cans and extruded plastic bottles. Low demand and weak financial performances have led to industry consolidation; the number of industry enterprises is expected to decrease at an annualized rate of 0.9% in the five years to 2013.
“Mergers and acquisitions have been an effective way for firms to take advantage of economies of scale in the manufacturing process and decrease the level of internal competition,” said Morea.
For more information, visit www.ibisworld.com.