That might sound like a bit of an odd question to ask, seen as though we all need glass throughout all parts of life. It’s an essential material we simply could not live without. But when you focus in on our industry specifically, life seems very tough for some of our big glass companies, especially for a business like Pilkington.
Just look at the pattern from Pilks and the other glass companies over the past few years. Price increases left, right and centre. The closure of a float line from Pilks which will probably never open again. Hundreds, if not thousands of jobs lost. Tens of millions of pounds lost each year. The state of glass really doesn’t look all that healthy right now. Especially for Pilkington.
The last two years have been a disaster for them. That float line closure was a massive hit. With the company bleeding money, this was their attempt at stemming losses by creating a demand shortage, allowing them to increase prices to stop the outgoing flow of money. This unfortunately doesn’t seem to have worked when you look at the whopper of a price increase they have just implemented. All of us I’m sure hate to see a company with the stature of Pilks in the situation it is. For me, it all went downhill when the Japanese bought them out. But it’s too late to start the blame game. They have to deal with the scenario at hand right now, and in all honesty, if they cannot stem their massive losses soon, I cannot see them staying the UK for much longer. Just my opinions.
What we haven’t seen this time round though is the usual cartel behaviour. Usually, when one major glass company puts their prices up, the rest usually follow within a matter of weeks – very much like the big six energy companies in this country. However from what I can tell this hasn’t happened. I would guess that the others are spotting that Pilks are struggling and holding fire on their own increases in the hope that they can pick up some new customers in the aftermath of their troubles. Anecdotally, the customer service from Pilks at the moment is that they don’t seem to care so much if they do lose customers. Which if true is crazy given the state their company is in right now.
Looking at the past few years as a whole though, the pattern of price increases does point to an industry which is struggling to make any sort of decent money now. Yes some are doing a lot better than Pilks are, but that’s not a difficult thing to achieve. But why does this matter? Well it matters because without all our major glass houses firing on all cylinders, forward progress in glass technologies is going to falter. Remember it is these guys that plough money into R&D departments to help bring to market new innovations for us to sell to the general public. Without that funding, progress stops, and so could their businesses.
But it’s difficult. We all quite often feel let down by the glass cartel in this industry. They have often had the monopoly over all of our business, and routinely flexed their muscle when it comes to things like prices increases. It’s that sort of behaviour which has only served to alienate us. So for many, they won’t feel an ounce of sympathy to hear that they might not be doing as well as they would like.
It’s a tricky situation. I myself have not been a fan of the recent massive hikes imposed by Pilkington, and by all accounts it sounds like this increase was the straw that broke the camel’s back for many of their customers. All that we can hope for in the coming years is that their ships steady, prices plateau, and we can all get back to working together for the greater good of us all.