America's love affair with TV is burning hotter than ever. Sales of conventional sets--those that don't project--ran at a record annual rate of 26.7 million in the second quarter, says the Electronic Industries Assn. (EIA).
This isn't great news to makers of glass parts for picture tubes, the heart of the set. Demand is overwhelming the capacity of the U.S.-based companies that sell them: Techneglas (a unit of Japan's Nippon Electric Glass) and Corning Asahi Video (a joint venture of Corning and Japan's Asahi). Thomson Consumer Electronics produces glass, but only for its own General Electric and RCA sets. Most sets sold in the U.S. have tubes made domestically.
Techneglas and Corning Asahi are greatly increasing imports of glass from Japan and Germany--not good, given the dollar's weakness. Imports of finished tubes and sets are up, too.
Why not just increase domestic production? Not so easy. It costs from $200 million to $500 million to build a plant, reports EIA. The two companies did boost prices about 5% in January. But with TV prices so low, they don't plan any further hikes until next year.