Guide to the growth opportunities in vinyl and metal siding, wood siding and brick, concrete and stone products, covering twelve individual product lines. This report finds that shipments of these twelve product lines accelerated in the 1990s. Growth was spurred by relatively strong increases in new residential construction and residential remodeling and repair markets. Demand was stimulated by a decline in interest rates, sharp gains in personal income and a surge in spending on home improvement projects. Manufacturers of vinyl siding and bricks benefited the most from these trends. Currently, growth opportunities are strongest in nonresidential markets. These trends were uncovered as part of SBI's investigation of siding's key end-use markets: new residential construction, manufactured housing, residential remodeling and repair and nonresidential construction markets. Analysis includes factors affecting demand such as construction spending, housing starts, single-family housing unit completions by exterior wall material and homeowner improvement expenditures.
In addition, SBI evaluates the demographics of siding remodeling and repair project purchasers. Purchaser demographics are also provided by the cost of the project, and whether the siding was installed as a do-it- yourself project or by a paid contractor. The competitive environment is investigated by analyzing the number of U.S. manufacturers, pricing trends and the coast structure of domestic plants. SBI profiled 25 leading manufacturers in order to uncover competitor growth- and profit-oriented strategies. Major competitors reviewed include Alcoa, Certainteed, Justin Industries and Louisiana-Pacific.
Rising Oil Prices Squeeze Vinyl Siding Profit Margins
NEW YORK, NY - (December 1, 2000) - PRNewswire/MarketResearch.com announced the release of a new study, “Siding” by Specialist in Business Information. According to the study, although demand for vinyl siding has continued to grow in 2000, a surge in resin costs due to rising oil prices will cut into siding manufacturer’s profit margins. Over the last eight years, vinyl siding shipment growth has significantly outpaced overall siding products, holding its place as the largest industry segment in the U.S. Yet even as vinyl siding shipments have increased at a 9.2% compound annual rate, rising to about $2 billion in 2000, it is estimated that the rising cost of oil derived products will hurt vinyl siding’s future competitive position in the U.S. siding market. “So far, there doesn’t seem to be a shift away from vinyl siding products on the consumer end”, said Claire Madden, VP of marketing at MarketResearch.com, “but as oil prices increase, manufacturers may have to pass their additional expense on to their customers. This could shift demand towards other less expensive siding options.” The U.S. residential siding product industry grew at a 10% annual compound rate between 1997 and 2000, outpacing all other construction material product gains. Leading the way were manufacturers of vinyl and brick siding. As the cost of manufacturing vinyl siding increases it is projected that the use of brick, wood, and concrete siding will gain in popularity. Aluminum siding shipments are estimated to be $369 million for 2000, down from $546 million just 20 years before. This is due to sharp declines of use in residential construction and improvement while the non-residential markets have kept aluminum siding profitable.
Scope And Methodology
The SBI Market Profile on Siding is a guide to opportunities in metal, vinyl, wood sidings and bricks, concrete products, and building stone — a total of 12 separate product lines. This comprehensive database covers U.S. shipments, price trends, exports, imports, the cost structure of domestic plants, and the competitive environment. In addition, leading manufacturers and marketers are profiled in order to review major competitor strategies.
U.S. siding product shipments are analyzed in the Executive Summary Section (Section 1). SBI Compiled U.S. Department of Commerce statistics on U.S. shipments for 12 product categories. Shipment data are for all domestic manufacturers, whether plants are owned by U.S.- or foreign-based companies and whether or not plants specialize (50% or more of total facility revenues) in one or more of the industry’s product segments. SBI also provides a growth analysis for price trends and end-use market shipments.
Shipment data are further segmented into three major sectors — wood siding, vinyl and metal siding, and brick, concrete, and stone siding. Wood siding, Section 2, covers shipments of solid wood siding, wood shingles and shakes, softwood plywood siding, hardboard siding, particleboard siding, and cellulosic fiberboard siding. Solid wood siding shipments are provided for nontreated and treated products. The number of U.S. manufacturers is provided for each product line. Import data for solid wood siding and wood shingles and shakes is derived from U.S. Customs’ records. Combined with export statistics, SBI calculated U.S. market sales (shipments minus exports plus imports) for solid wood siding and wood shingles and shakes. Price trends for cedar shingles and shakes and softwood lumber materials are analyzed from Bureau of Labor Statistics surveys. In addition, SBI provided quantity shipments for plywood and engineered wood sidings from U.S. Department of Commerce surveys.
Section 3 covers vinyl and metal siding products. Metal siding shipments include aluminum and steel sheet metal sidings and accessories, and metal panels. Aluminum siding shipments are further segmented into residential and nonresidential product lines. In addition, quantity residential siding shipments are provided from surveys of the American Architectural Manufacturers Association. The report also provides vinyl siding and accessories shipments and the amount of polyvinyl chloride consumed by siding manufacturers. The latter is provided by the American Plastics Council. This section also includes price trends for all product lines and material inputs, exports and imports for aluminum siding and related products, the cost structure of sheet metal siding plants, and the number of manufacturers.
Shipments of brick, concrete, and stone products are analyzed in Section 4. Brick data include unit and dollar shipments, the number of U.S. manufacturers and plants, the cost structure of U.S. plants, state shipments and operating ratios, exports, imports, and price trends. Shipments, the number of manufacturers, and price trends are also provided for precast concrete wall panels and decorative concrete block. Similar data is provided for building stone. Building stone shipments are further segmented by granite, limestone, and marble and other products.
End-use market shipment and related data are divided into four sections — new residential construction, manufactured housing, residential remodeling and repair, and nonresidential markets. Siding product shipments to the new residential construction market are analyzed from various U.S. Department of Commerce data trends (Section 5). Shipments to new residential construction contractors are segmented by the industry’s 12 product lines. Demand was further evaluated based on the type of exterior wall materials used to complete U.S. single-family housing units, including stucco. This data was evaluated by region and the price of the new homes. In addition, SBI evaluated factors affecting demand, including real residential building construction trends, building permits issued, new housing units started and completed, and interest rates and personal income trends.
The U.S. manufactured housing market is analyzed in Section 6. Shipments to this end-use market were provided for vinyl, metal, and wood siding products and purchases for mobile home and other prefabricated wood building plants. SBI also calculated shipments per manufactured housing plant and siding’s share of total plant material inputs. In addition, plant shipments are provided by product and state.
Section 7 investigates the residential remodeling and repair market. SBI Compiled Department of Commerce data on U.S. spending on siding home improvements, analyzed shipments to this market for 12 product lines, and spending by purpose of project. Simmons Market Research Bureau surveys also provide data on the likelihood of U.S. adults to purchase siding by demographic characteristics. Purchaser demographics are also provided by the cost of the project, and for do-it-yourself projects and contractor installed projects. This section includes data on retail siding sales.
U.S. nonresidential construction markets are analyzed in Section 8. Shipments to new nonresidential building markets and nonresidential remodeling markets are analyzed for the industry’s 12 siding product lines. Data trends also cover new nonresidential construction spending by type of building.
Siding contractor revenues and operating ratios are evaluated in Section 9. Data trends cover siding contractors, masonry and stone contractors, and stucco contractors. Statistics include the number of contractors, subcontracting work, number of employees, and payrolls.
SBI supplements U.S. Department of Commerce data with individual company information (Section 10). Annual reports, databases, and trade journals were searched for growth- and profit-oriented strategies and recent developments. Sales and profit trends are provided for selected manufacturers.
Action-oriented executives are urged to use this comprehensive statistical database and competitor information to develop new products, take advantage of favorable demographic patterns, expand foreign market sales, and initiate profitable operating strategies. Executives are urged to compute their own company’s market share and compare their own company’s operating ratios to the industry averages as part of this process.
Section 1 Executive Summary And Us Siding Product Market Trends
Scope And Methodology
Section 2 Us Wood Siding Product Markets
Section 3 Us Vinyl And Metal Siding Product Markets
Section 4 Us Brick, Concrete, And Stone Siding Product Markets
Section 5 Us New Residential Construction Markets
Section 6 Us Manufactured Housing Market
Section 7 Us Residential Remodeling And Repair Market
Section 8 Us Nonresidential Construction Markets
Section 9 Siding Contractor Revenues And Operating Ratios
Appendix Names And Addresses Of Major Siding Manufacturers And Their Subsidiaries