The Future of the Smart Glass Industry and Smart Glass Market Growth (New Report)

The smart glass market is estimated to rise at a CAGR of 10.4 percent during the forecast period, from USD 5.0 billion in 2022 to USD 8.2 billion by 2027. Smart glass, also known as switchable glass, dimmable glass, or magic glass, can adjust the light transmission properties dynamically or statically, depending on the stimuli. The stimuli altering the light transmission properties could be light, voltage, or heat. Smart glass does not require electricity to maintain its state of opacity or for a color change. The installation of smart glass helps reduce the energy spent on heating, ventilation, and air conditioning (HVAC) and lighting systems as well as improves the indoor environmental quality of buildings. Decreasing price of electrochromic prices, energy saving capacity of smart glass and use of smart glass in automobile application are significant drivers driving the growth of this market.

Driver: Energy-saving capacity of smart glass

The global energy demand continues to grow despite the historic high prices and mounting concerns over energy security. Improving the energy efficiency of homes, businesses, schools, government buildings, and industries is imperative to balance energy supply and demand. According to the US Department of Energy (DOE), heating, cooling, and lighting of buildings together account for 25% of the total energy costs of the country. According to the DOE estimation, smart glass can reduce energy consumption by ~40%. Heating, cooling, and lighting equipment consume a lot of energy, adding to the overall expense of any industry. The type of glass used for windows, doors, and partitions in a room has a major impact on the room’s energy consumption. The heat and light transferred through the glass directly impacts the comfort level of the room’s occupants, apart from affecting energy costs. Switching to smart windows makes a huge difference in overall energy consumption. Smart windows are installed with smart glass, which regulates the amount of light passing through them, depending on the time of the day. As a result, these windows can switch from translucent to transparent without consuming much energy.

Restraint: Technical glitches in functioning

Despite technological advancements in smart glass, some operational or functionality issues remain unaddressed. Despite having the ability to adjust to different wavelengths and control the amount of light penetrating through it, smart glass cannot provide exact color transparency. This results in improper color balance and clarity issues. The user expects to get an exact view of the exterior through the windows; however, the contrast ratio of the front view/object often gets disturbed, resulting in improper visibility. Smart glass costs more than ordinary glass, leading the user to expect superior performance. Such shortcomings are restricting the growth of the smart glass market. Usage of passive smart glasses in extreme temperatures has been an issue due to their functioning related to the surroundings rather than user preference. The recycling of smart glass is also another issue. Although smart glass is helping the environment by conserving energy, recycling smart glass is still a factor to be considered, as no proper procedure is adopted for recycling.

Opportunity: Growing need for sustainable buildings

The world is becoming conscious of climate change, global warming, and its impact on the planet. The pandemic has also shown the need for green buildings and the benefit of having a sustainable living space. Governments and world organizations are moving toward sustainability, wherein green buildings have a major role in achieving a carbon-neutral society. As part of the EU (European Union) Green Deal, the European Commission has set a target to make Europe a climate-neutral continent by 2050, focusing on sustainable building and energy performance. The EU also issued directives to member states like the "New Energy Performance in Building" in 2018 to promote sustainable buildings. Furthermore, the US had 3,156 registered green buildings with LEED (Leadership in Environmental and Design) in 2005, compared to ~70,000 in 2019. Thus, the current focus on green buildings and sustainability has the potential to generate growth opportunities in the smart glass market.

Challenge: High initial costs of R&D and manufacturing

Companies operating in the smart glass ecosystem incur high manufacturing and R&D costs. The high manufacturing cost has resulted in a high selling price for smart glass. Smart glasses are mostly used in premium, high-end applications because of their high costs. In the automobile sector, smart glass is used in windows, sunroofs, rearview mirrors, and side windows in premium cars. Similarly, in the architectural sector, high-end corporate or commercial buildings use this type of glass in their designs. This niche and elite customer base signifies a higher customer concentration ratio and greater dependency on fewer customers. The limited number of customers puts a limitation on the overall returns. As a result, the ROI is extremely volatile and could restrict the overall growth of the smart glass market.

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