Tile Industry Market Overview and Forecast, Part Two: U.S. Ceramic Tile Industry Poised for Continued Growth in 2005 and Beyond
One of the most important trends in the ceramic tile industry is the increase in imports from the Far East and South America. Countries such as Brazil, Mexico and China continue to increase their market share in the U.S., spurred on by favorable exchange rates and low manufacturing costs (Table 5 and Charts J, K, L and M).
Tile Market Will Continue to Expand
During 2005 and Beyond
For the remainder of 2005 and beyond, there will be a continuing general expansion of the tile market, which follows the overall growth of the U.S. economy, particularly increased home remodeling sales. Tile imports will see a continued increase, and there will be increased competition at the lower end of the market as low-cost manufacturers compete for market share.
Looking ahead to what we can expect in 2010, there will be a projected yearly expansion of the U.S. ceramic tile market, from 2005-2010, of 7 percent on average. Tile consumption is projected to increase from 292 million square feet in 2005 to 410 million square feet in 2010 (Table 6 and Chart O). During this period, imports will increase to account for 85 percent of U.S. consumption. There will be increased imports from the Far East and South America. This period will also see a continued increase in U.S. per capita consumption of tile. Also, there will be more sales of ceramic tile through flooring retailers.
Overall, the prospects for the ceramic tile industry during the next year are very good, but there are some unknown factors that could influence the industry, such as inflation, interest rates, and the housing market. Any change in these factors, positive or negative, will have a corresponding impact upon the ceramic tile industry. Other important factors to watch out for are the strength of the dollar, the impact of new tile manufacturing technology, and sociopolitical factors such as immigration and demographic growth, and the situation with international terrorism. If the situation in Iraq is resolved favorably, the federal deficit will be reduced substantially and the dollar will likely increase much more.