GW: With the economy hit hard due to the Covid-19 pandemic, what was the impact on the flat glass industry?
The flat glass industry was no exception and in fact, was probably among the industrial sectors hit the hardest. The first task was to ensure health and safety in industrial operations. The biggest challenge, however, remained that of the rapid and drastic fall in demand for flat glass products.
Automotive assembly plants in Europe were stopped for over two months. Therefore, demand for auto glass was down to nearly zero and automotive glass plants had to be temporarily closed. In countries with most stringent lockdown measures, the building glass market collapsed as the construction industry went to a halt and clients were not in a hurry to have glaziers at their homes to install new windows. This means that the entire value chain of glass processors, IGU makers, glaziers etc all suffered big losses and some cessation of activities in certain parts of Europe.
When it comes to flat glass production, around half of float glass sites had to cease production by way of so-called ‘hot-hold’ operations, which entail high cost for zero output.
GW: What can we expect in the months to follow?
The situation has already improved since mid-May/early June, with the easing of lockdown measures. Automotive plants resumed production, albeit at very low levels and construction started activity again in most countries. During the summer, demand for flat glass products has continuously grown to flatten at around three quarters of last year’s activity levels. However, the situation is very dependant from one country to the next but all industry stakeholders must have witnessed some improvement.
Is the relief temporary or will it last and the market continue growing? To be honest, I don’t know but I am a bit pessimistic because most of the activity observed in recent months was about construction projects launched before the crisis and the number of permits for new construction is ridiculously low. When it comes to the glazing/window replacement market, particularly in the residential sector, it remains worryingly low. European consumers remain preoccupied by health conditions when works are undertaken at their homes and the consumer confidence level is such that investment decisions are postponed. Without a rapid pick-up of this market segment, many players in our sector could find themselves in a very delicate financial situation as support measures are lifted.
GW: Looking more optimistically, will economic stimulus packages bring more hope?
I hope so. There is no fatality to a downward spiral!
First, I think we must applaud most Member States’ efforts to keep the economy going during the crisis and all emergency support measures put in place. Second, the reaction from European authorities is also very positive when it unveils a recovery package of an unprecedented magnitude. For the first time ever, a plan worth €750 billion is being discussed at EU level! With this plan comes a political declaration to invest massively in the renovation of Europe’s buildings, which could generate the much-needed stimulus to the building glass sector.
We must now translate these declarations into actions and make sure that among these actions, plans to massively retrofit Europe’s inefficient glazing and window stock are developed.
GW: What are the prospects with regards to window and glazing retrofit plans? What needs to be done to see them being put in place?
Our industry does not need to be shy! Our sector is in danger without effective support measures, so we must call for them. Window retrofit plans could help save lots of energy and CO2, which is an essential criterion or condition for recovery support measures that are compatible with our climate objectives. Support to window and glazing replacement are measures understandable by the public and usually well-accepted because they resonate with improved indoor comfort and wellbeing. Window/glazing retrofit plans tick all the boxes.
As diverse as we are as players of the flat glass industry, it is our collective task to convince EU, national and local authorities to design such plans and to help them conceive effective measures.
GW: What role will Glass for Europe play alongside all industry players?
As Glass for Europe, we are articulating these messages: Developing the headline arguments and conveying those onto EU authorities. Several papers have been developed and their content shared, as the European Commission is looking at implementing a strategy for a ‘Renovation Wave’ of buildings.
Our tasks go beyond this, however, with two pillars:
• First, the co-ordination of activities of national glass and glazing associations across Europe. Most of the funds made available by the EU Recovery Plan will be spent by the Member States, which are free to design their own economic stimulus measures. It is essential, therefore, that in all countries, trade associations and industry players call on their government to design such glazing/retrofit plans.
• Second, giving clues on possible measures that are effective at boosting the market in volume but not only. The measures must also be conceived so as to support sales of high performance glazing, be it low-E glazing or solar control glazing. We must improve the glazing specifications for all industry players to enjoy higher added-value and their fair share of it.
Everyone in the industry can play a role to call for and design the plans. I invite anyone willing to engage to check out all materials made available by Glass for Europe and to get in touch with us for co-ordination! l