Opportunities in challenges

Customers are viewing glass products at the Vietbuild exhibition.

Domestic manufacturers are striving to improve product quality and develop new lines of glasses to meet the growing demand for quality and technical features.

Many challenges

According to construction materials expert and Master Pham Ngoc Trung, the market for construction glass in Vietnam has been developing strongly, especially in the context of rapid urbanization and increasing demand for high-rise buildings and commercial projects.

Glass products are not only used in civil construction but are also popular in high-end projects such as office buildings, shopping malls, luxury apartment complexes, and important infrastructure projects.

Currently, the market offers many types of glass for construction, such as tempered glass, insulated glass, laminated glass, heat-resistant glass, etc. These have diverse uses, including glass doors, glass partitions, domes, soundproofing, and heat insulation. They are produced domestically or imported, and their prices are relatively affordable for all customer segments. For example, tempered glass, depending on its thickness (5, 8, 10, 12, 15, or 19 mm) and origin, costs from 500,000 to 2,500,000 VND/m2.

“The building glass market is witnessing fierce competition between domestic manufacturers and foreign importers. Well-known brands such as Guardian, Saint-Gobain, and PPG have established a presence in Vietnam and hold a large market share. Domestic manufacturers are also striving to improve product quality and develop new glass lines to meet the increasing demand for quality and technical features,” Mr. Trung observed.

However, the market began to stagnate due to the "freezing" of the real estate market, and consequently, demand for construction glass products also plummeted to very low levels. In addition, one of the major challenges for the construction glass market in Vietnam is the cost of high-quality glass products, especially imported products.

High costs increase construction expenses, thereby affecting the selling prices of real estate projects. Many projects are stalled, preventing businesses in the industry from repaying debts, leading to difficulties and inefficient production and business operations. According to data from the Ministry of Construction, from 2022 to June 2024, three production lines had to cease operations, including: Viglacera Float Glass Factory (VIFG) – Binh Duong; Chu Lai Float Glass Factory (Chu Lai, Quang Nam ); and Trang An Float Glass Factory (Ninh Binh).

One of the "giants" in the glass industry, Viglacera Corporation, recently announced its business results for the third quarter of 2024. Accordingly, after-tax profit in its separate financial statements decreased by VND 177.2 billion, equivalent to a 43.9% decrease compared to the same period last year.

As of the end of September, Viglacera's total assets amounted to VND 24,231.2 billion. Of this, fixed assets totaled VND 5,990.5 billion, equivalent to 24.7% of total assets. Inventory reached VND 4,583.5 billion, accounting for 18.9%.

Notably, regarding the capital structure, liabilities as of September 30th amounted to VND 14,277.6 billion, equivalent to 58.9%. Of this, short-term debt was VND 7,850 billion and long-term debt was VND 6,427.5 billion. Total short-term and long-term borrowings and financial leases exceeded VND 5,018 billion, a slight decrease compared to nearly VND 5,135 billion at the beginning of the year. This outstanding debt accounts for 20.7% of the company's total capital.

New opportunities

According to Master of Economic Law Le Son Tung, Vietnam is promoting the development of sustainable construction projects, encouraging the use of environmentally friendly and energy-saving building materials.

This has facilitated the development of various types of building glass such as Low-E glass, insulated glass, and smart glass. Green building projects like LEED and EDGE are becoming a trend, boosting demand for energy-efficient and environmentally friendly building glass.

With support from government policies and the development trends in the construction industry, domestic glass manufacturers are striving to develop products and improve quality to compete with imported products. Domestic manufacturers can focus on increasing the production of tempered glass, safety glass, energy-saving glass, and developing new product lines with more competitive prices.

Furthermore, recently, in accordance with the Government's directives in Resolution No. 108/NQ-CP dated July 10, 2024 and Directive No. 28/CT-TTg dated August 26, 2024, the Ministry of Construction has developed and widely solicited feedback on the draft Circular guiding the management of quality of construction materials and products. On November 1, 2024, the Circular was issued with many new contents (Circular No. 10/2024/TT-BXD).

Specifically, the import of construction glass is strictly controlled to ensure quality and compliance with Vietnamese standards, aiming to alleviate difficulties for the domestic glass manufacturing industry. Importers will be fully responsible under the law for the quality of the goods they import.

For float glass products, the management measures for imported goods will include: State quality inspection before customs clearance; Registration for state quality inspection before customs clearance; The basis for state inspection will be based on the certification results of a designated certification body; The inspection agency is the Department of Construction.

As can be seen, the construction glass market in Vietnam is presenting significant opportunities but also facing numerous challenges. With the strong development of the construction industry, especially high-rise buildings, real estate projects, and the demand for green buildings, the construction glass market is expected to continue its strong growth in the coming years.

However, businesses need to focus on improving product quality, upgrading production technology, and meeting safety and environmental protection requirements to capture market share and achieve sustainable development.

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