A new $150 million factory in Faribault, Minn., aims to bring down the cost of its variable-tint glass and open up a worldwide market.
Fresh off its acquisition by a French industrial giant, Sage Electrochromics has finished building a $150 million factory in Faribault, Minn., and is poised to ramp up sales of its variable-tint glass. And reap its first profits.
The market for smart glass is expected to grow eightfold to nearly $700 million by 2020, according to recent report by Pike Research. Sage's technology, which alters light transmission with a flip of a switch, offers energy savings on lighting, heating and cooling, especially in large buildings.
Sage, now a subsidiary of Saint-Gobain, a French building products company with $54 billion in annual sales, believes the market could be even bigger. And for now, Sage stands to be the key player.
"They see this as the future of glass," Sage founder and CEO John Van Dine said of the company's new owners.
For Faribault, a city of 23,450 people located 50 miles south of the Twin Cities, the project already is creating well-paying jobs, and promises more.
"This is the largest economic development project that the city has done in recent years, probably ever," said Faribault's community development director, Peter Waldock, who helped assemble $13.6 million in state and local loans and incentives. "This is new technology. ... We hope to see it grow."
Van Dine founded Sage in New York in 1989, and moved it nearly a decade later to Minnesota, which he calls "the Silicon Valley of the window industry" because it's home to windowmakers like Andersen, Marvin and Viracon. Saint-Gobain acquired 100 percent of Sage in May.
SageGlass has been produced at a smaller, adjacent plant in Faribault since 2004, and used widely in skylights. But for commercial building windows, it's remained a niche product, installed in projects ranging from a truck weigh station in Wyoming to a college library in White Bear Lake to a wind turbine factory in Kansas.
Windows using SageGlass don't need shades or blinds to reduce glare. Sunlight is controlled by sending electric current to a patented electrochromic film applied on the inside of the double or triple panes. Even when set to maximum tint, the windows offer a view outside.
Yet the windows have had major disadvantages -- higher cost compared to conventional glass, relatively small panel sizes and only one tint color, blue. Van Dine said those drawbacks will disappear when glass starts rolling off the new plant's automated production lines next year.
The new factory will produce glass in a range of color tints, with panel sizes up to 5 feet by 10 feet, he said. The glass will cost less -- about $45 to $55 per square foot -- thanks to economies of scale, and the goal is to be "price neutral" against the combined cost of conventional glass and window treatments, he said.
"Everyone who has ever seen our glass says they want it," said Van Dine, who expects Sage to make a profit in 18 months after production begins next year.
Market to take off?
Smart glass has a high "cool factor." But it has cost two to three times more then conventional glass, said Eric Bloom, senior research analyst for Pike Research and co-author of a recent report on the smart glass market. If prices drop after the opening of new factories like Sage's, Bloom said, the glass should gain broader acceptance.
"Smart glass is the first innovation in the history of glass that transforms glass from a passive to an active technology in a building," Bloom said.
Denver architect Paul Hutton, who advocates building designs relying on natural light, said variable-tint windows can be tied to automated controls to boost efficiency of lighting, cooling and heating.
"Daylight is free and electricity is expensive," said Hutton, principal in Hutton Architecture Studio. "If we are very careful with how we use daylight in a building, we can use it to substitute for electric lights. It can be among the most important energy efficiency strategies in a large building."
Hutton turned to SageGlass to solve an unusual design problem -- workers at a new Wyoming truck-weighing station needed a glare-free view of the highway and incoming trucks.
"Any kind of window blinds was too much of an obstruction," he said. "We needed to find another way to let them see what's going on yet prevent them from being blinded by the sun."
Several competitors offer other types of smart glass, though electrochromic glass represents a major share of the market segment and Sage argues it is the most controllable. One other electrochromic glass company, California-based Soladigm, looms as a major competitor, with a plant under construction in Mississippi.
Sage already adding jobs
Sage has ramped up hiring for the new factory, and production lines are now being tested.
The company expects to have 140 production workers when the plant is fully staffed, and about 250 for the entire company. That's up from 65 production workers at the existing plant and 137 total employees, the cmpany said.
Sage's production process begins with raw glass purchased from a supplier. It applies electrochromic, or variable-tint, layers to the glass, then cuts panels to size, adds controls and seals the panes into window units.
Sage doesn't produce window frames, though it sells SageGlass units to Marvin Windows of Warroad for insert into custom-order products. Van Dine said the company is talking with other window makers to add SageGlass to their products.
Computer workstations, sealed chambers, glass cutters, conveyors and robots are scattered across the Faribault factory floor. Basic production work will pay about $13 per hour, but other jobs requiring technical training will pay more, up to $80,000 a year for engineers, the company said.
Some existing workers will move over from the adjacent existing plant, which is being converted into a research center, Van Dine said.
After Saint-Gobain acquired full ownership of Sage, Van Dine said, the global company shifted all its electrochromic glass efforts to the U.S. subsidiary, abandoning plans for a factory in France and centralizing marketing of the new product in Faribault.
"This new facility is not only going to employ people in Minnesota, but is going to ship this product around the world," Van Dine said.
David Shaffer • 612-673-7090