Executive Summary

In 1998, the market for windows and doors was estimated to be worth £1.34bn at manufacturers' selling prices (msp). At installed prices, this translates to a market value of £3.54bn. The market is segmented according to the main materials used: unplasticised polyvinyl chloride PVC-U), wood, aluminium and steel.

There are two main sectors in the windows and door markets, new build and replacement (mainly for domestic premises).

In the new build sector, the main market is housebuilding. The number of housing starts decreased by 3.2% in 1999. However, the Government has recently issued further details of its plans to build around 4 million dwellings to satisfy demand. The most important buildings in the non-housing sector are offices and shops. Refurbishment work is a large sector in the construction industry, with a housing output value of £16.2bn, compared with £8.43bn for new work.

There is fierce price competition in the replacement market, which has led to rationalisation within the industry and, during 1998/1999, a number of well-known names changed hands.

International trade remains important and imports — particularly of hardwood products from the Far East and South America — are high. The UK's largest manufacturer of timber windows and doors was recently sold as a result of competition from timber imports, as well as the strength of sterling.

Penetration of replacement doors and windows has been steadly rising and stood at 37% of households in 1999, with 4.1% of households buying over the 12-month period.

The recent rises in interest rates, following a series of cuts in 1998, make forecasting difficult. While each movement in interest rates has been small, they might still give rise to a roller coaster economy and a wait-and-see attitude to spending. Even small changes in consumer confidence can have a significant effect on the windows and doors market. Effectively, it is the general public who buy most windows, whether in the form of a new house or for replacement work on an existing one.

Key Note forecasts a rise of 1.5% in 1999, bringing market value to £1.36bn. Thereafter, growth will accelerate annually to around 4.5% in 2003, bringing market value to £1.56bn. These estimates are based on the assumption that the Government will continue to control inflation and wages, but not with such vigour as to cause a significant downturn in the economy.

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