Glass and Fiber Optic Manufacturing
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Industry Overview
The US glass industry includes 2,000 manufacturers with combined annual revenue of $25 billion. Large companies include PPG Industries, Owens-Illinois, and Corning. The industry is highly concentrated: the 50 largest companies hold close to 90 percent of the market. Most companies in the industry manufacture products from bulk glass bought from a handful of primary glass manufacturers.
Competitive Landscape
Demand comes from the construction, auto, bottling, and container industries. The profitability of individual companies depends on low-cost operations because most products are commodities that are bought based on price. Large manufacturers have large efficiencies of scale in operations, which is why the industry is so concentrated. Small manufacturers can compete effectively by producing specialty products or serving a local market. The industry is capital-intensive: annual revenue per worker is close to $200,000.
Products, Operations & Technology
Major products are glass containers, flat glass, fiberglass, and specialty products such as TV tubes, glass ware, lenses, mirrors, and optic fiber. Specialty products account for more than half of industry revenue, containers about 25 percent, and flat glass about 10 percent.
Bulk glass is made by melting quartz sand and adding various substances such as limestone, soda ash, metals, and other materials to produce a "melt." The melt is then formed, cooled, and further processed by grinding, cutting, and polishing into finished products. Glass furnaces, or "tanks," usually fired by natural gas or oil, melt the raw material mixtures at temperatures up to 1,600 degrees Celsius. Tanks for container glass may produce 500 tons per day, while flat glass tanks produce up to 1,000 tons per day.
Molten glass is formed before it cools, using four major methods. Containers and TV tubes are produced by blowing molten glass into forms. Flat glass is usually produced by floating molten glass on top of a molten tin bath, then running it through rollers. Fiberglass is produced by pulling or spraying strands directly from the melt. Special shapes can be produced by pouring molten glass into ceramic molds. Because production of various glass products requires different kinds of equipment and manufacturing skills, most producers operate in only one segment of the industry. Because raw glass production technology is relatively unsophisticated and the raw materials inexpensive, manufacturers concentrate on production efficiencies.
Optic fiberglass is an ultra-high-purity silica glass that can be stretched into long, hair-thin fibers and used to transmit information over long distances, a replacement for copper wires. Fiber optic strands consist of an inner core of high purity glass with a high refractive index that transmits light, and an outer core of low refractive glass that keeps the light signal from seeping out the sides. The basic unit from which fibers are drawn is called a "preform," a glass cylinder that may be several inches thick and several meters long, with a core of high refractive glass and a clad of low refractive glass. The preform is placed inside a draw furnace, heated to 2,000 degrees Celsius, and stretched into hair-thin, flexible fibers that may be many miles long. Fibers are coated, colored, and bundled in a protective jacket to form optic fiber cables.
The basic technology of glass manufacture is well-known, but research into the properties of various glasses has resulted in a long list of possible new formulations and applications. To improve the efficiency of production, especially to make various specialty glasses, sensors and computer controls are used.