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June, 1996

Japan's Auto Glass Firms Push UV Products


 

    TOKYO - In a bid to boost sales in a shrinking domestic market, Japanese auto glass companies are revving up their production of glass varieties that filter ultraviolet light.

    The manufacturers face tougher conditions at home because more and more Japanese auto production is moving overseas under pressure from high domestic costs.

    Asahi Glass Co., Japan's largest glass manufacturer, said it will increase production of UV-filtering auto glass to 1.7 million cars this fiscal year ending March 31, 1997, from 300,000 in the previous year.

    Kenichi Imoto, a spokesman for Asahi, said while UV filters are commonly painted on the surface, the company last year adopted a new process whereby anti-UV material is added directly to the glass during the production process.

    But foreign glass companies - who have fought a long battle to try and gain access to Japan's protected market - say one problem with Japan's oligopolistic market structure has been a lack of innovation.

    This type of glass has been common abroad for years, they add. ``Japan is far behind using UV-filtering auto glass for automobiles than the United States,'' said an official for Guardian Industries Japan Ltd., a subsidiary of Michigan-based Guardian Industries Corp. Nippon Sheet Glass Co., meanwhile, said it also introduced similar auto glass last year. Japan's second-largest sheet glass manufacturer adds that it hopes half of its auto glass production will soon be this specialty glass before too long.

    "I think glassmakers are trying to sell this type of value-added product as a way to increase sales in the domestic market,'' said Chiharu Shima, an analyst for Barclays de Zoete Wedd Japan Research.

Shima said Japan's glassmakers are being pressured by auto companies to lower prices.

    "Glassmakers are desperate to sell the more expensive UV-filter auto glass, while they keep the manufacturing cost as low as possible to make such glass,'' the analyst said.

    A spokesman for Nippon Sheet Glass said the newly introduced UV-filtering auto glass is less difficult to manufacture than previous versions.

    Only Japanese luxury cars used to be equipped with UV-filtering auto glass. But Japanese automakers have started installing more of the sun-bloc auto glass for regular cars. Among other things, this glass can help cut fuel expenses when drivers are using air conditioning.

    A spokeswoman for Toyota Motor Corp. said the company has increased its use of UV-filtering auto glass to include 12 models.

    Shima, the analyst, said Japanese automakers wouldn't buy UV-filtering auto glass from foreign companies although the carmakers know imported glass is cheaper and better.

    The analyst said imported auto glass faces even more barriers than regular sheet glass in Japan because of the close relationships between Japanese automakers and glassmakers.

    A Toyota spokeswoman said the company's luxury car model, Celsior, is the only one equipped with so-called green glass, a high quality UV-filtering auto glass. The glass is of a better quality than regular UV-filtering auto glass.

    The Toyota official said the auto glass is manufactured by Libbey Owens Ford Co. in the United States. But Libby is a related company of Nippon Sheet Glass.

source: Journal of Commerce