Sputtering ahead: Soleras Advanced Coatings focuses on high-tech glass makers
Photo / Tim Greenway
Soleras Advanced Coatings CEO Jeffrey Edel in Biddeford next to rotatable sputtering targets used for depositing thin films.
Photo / Tim Greenway
Fred Weber cleans a mold in preparation to cast a sputtering target at Soleras Advanced Coatings in Biddeford.
Sputtering, also called physical vapor deposition, is a process for laying down very thin coatings of materials, such as metals, evenly across a substrate, such as glass. The two main methods are either planar (left) or rotating targets. Planar is a more widely used and less costly technology typically employed now for coating smaller items like integrated circuits, while the new rotating, or rotary, technology costs more but leaves less post-production debris on the substrate, and thus is used in high-end glass and computer displays. Both technologies use a gas such as argon in a vacuum chamber. The gas is given a charge, or ionized, so a magnetic field can drive the argon ions at high speed against the sputtering target. When the argon ions hit the sputtering target, they dislodge small metal particles that become a vaporized material that in turn coats the glass or other substrate. Soleras uses mostly the rotating method for glass customers who need to make typically very large and high-end architectural glass or computer displays.
The word “sputtering” may evoke images of a car engine choking before it fails, but in the high-tech world of advanced coatings, it's a high-speed, high-volume process where superfast ions hit a metal target and dislodge miniscule particles that in turn coat a thin film over cutting-edge products like architectural glass, large-screen televisions and computer displays.
Soleras Advanced Coatings, based in Biddeford, is a big international player in that high-tech market, making components such as sputtering targets that aren't visible in the final products, but are necessary to making them.
It's a niche market — and an esoteric one at that — but it is growing quickly. The market for sputtering targets and sputtered films, which includes the long metal tubes Soleras makes that serve as the bombarded targets, is expected to reach $3.2 billion by 2018. That's a 1.3% compounded annual growth rate from 2013, according to BCC Research of Wellesley, Mass. And it's a market where Soleras claims it's a leader in selling sputter targets for high-end applications like the low-emissivity or low-e, energy-efficient architectural glass seen in modern skyscrapers, smart glass that can change color and in very large displays.
Soleras CEO Jeffrey Edel says the quality of his product, and his company's unusual location, differentiate it. Most competitors are located in high-tech areas like Silicon Valley or large cities around the world.
“It's neat because we're in Biddeford,” says Edel. “It wouldn't be as special if we were in California.”
In fact, it's easy to drive by Soleras, tucked behind the Biddeford Municipal Airport sign at the edge of that city. But the sputtering equipment and components company is well known to international, high-end glass makers, to whom it has been selling since 1968. In fact, some 75% of its less than $100 million in sales are overseas, mostly in China and Europe, with no sales in Maine, but the remaining 25% in the United States. Edel expects sales, which are growing 10% to 20% annually, to hit $100 million by 2016.
Though founded in 1968, Soleras Advanced Coatings assumed its current form in 2012, when Radnor, Pa.-based private equity firm Element Partners purchased Soleras Ltd. and combined it with Bekaert Advanced Coatings of Belgium. Both companies develop equipment and rotatable targets for thin-film sputter deposition. The acquisition of Bekaert's coating operations included its facilities in Belgium, China and Wisconsin.
While sputtering technology has been used for decades, mainly in the electronics market in items like integrated circuits, it now is being applied to disk drives, advanced displays and low-e glass. The energy segment accounted for close to 29% of the total market in 2013.
Despite rising dollar figures, unit sales are expected to drop almost 1% to 955,000 units in 2018, mostly because the individual units are larger than earlier products, and thus can be cut into smaller pieces. “The drop is due to the trend toward the use of fewer but larger targets, reflecting a change of product mix related to the growth of applications such as flat panel displays, optical coatings and solar cells,” BCC Research analyst Margareth Gagliardi noted when she released her research report in May 2014.
For Soleras, the focus now is on low-e architectural glass coatings. Edel says Europe and China are moving more quickly than the United States to adopt the energy-saving coated glass in both commercial and residential uses.
China is the company's fastest-growing market. While low-e glass has a market penetration rate of 80% in developed countries like Germany, the rate in China is still only about 11%, according to QYResearch Reports of Albany, N.Y. The market researcher expects China's demand for low-e glass to grow 23.5% compounded annually from 2014-2017. China's low-e glass production rose to 134 million square meters in 2013 from six million square meters in 2005, and is expected to rise to 152 million square meters in 2014.
What is sputtering?
Sputtering, also known as physical vapor deposition, is a process that evenly deposits very thin films across a substrate, such as glass. Soleras makes the components used during the sputtering process, known as round or rotary sputtering targets, metal tubes that can be longer than 12 feet and around six inches in diameter. The company produces sputtering targets with different metals, then sells them to glass makers for coating their glass.
Soleras uses several different methods to make its sputtering targets, but most commonly it uses spraying and casting. Spraying involves accelerating droplets of molten metal wire or metal powder through a plasma gun that hit the sputtering target. The droplets flatten upon impact to coat it. Casting involves melting a metal and pouring it into a mold that contains the sputtering target. The coating is placed in the space between the outside casting and the target, coating it to the depth desired by the customer. Coating materials include silicon, aluminum or zinc alloy.
The tradeoff between the two technologies is that spraying is lower cost, but more unwanted particles get onto the target, while casting has fewer stray particles but costs more. Spraying can't be used in the computer display industry because of the issue with extraneous particles.
“What makes Soleras special is our capability to cast,” says Jason Bergquist, director of operational excellence at the company. “We have two casting units here. This is all proprietary technology that we build.”
Most of the Soleras sputtering targets are rotary for high-end applications, but the company does make flat, or planar, targets for specific applications. In the overall market, planar technology is used more frequently, but because sputtering debris tends to fall back onto a flat surface, rotary technology is starting to replace it in large, coated-glass production.
Edel says about 20% of demand today is for the rotary sputtering targets that Bekaert developed in the late 1990s. Those targets compose 98% of Soleras' business. To date, Soleras has produced more than 260,000 targets.
Glass makers use the sputtering targets to coat their glass. During the coating process, argon gas is placed in a vacuum chamber and is ionized (gets a charge) so that magnetic fields can drive the argon atoms at high speed against the rotating sputtering target within a chamber. The argon atoms knock material loose from the sputtering target. This process occurs as a large piece of glass passes through the vacuum chamber. The loose material coats the glass. The glass coating is built up in layers by moving the glass back and forth.
“Our customers in the United States are primarily people who produce architectural glass…and sell that glass to window producers,” says Edel. Cardinal Glass Industries and Guardian Industries are examples of glass company customers, he says.
“You tend to see broader demand in markets like Europe where the cost of energy is higher, and where there's a deeper legacy of environmental regulations in place,” he says. “Now you're starting to see that in China, too, because of the tremendous pollution problem they have.”
In a large building, low-e glass translates into big cost savings, as it can help keep heat in during the winter and out in the summer. The same is true in residences. Edel says the cost per kilowatt hour in Europe is about 25 cents to 35 cents, while Edel, who still lives in Ohio, pays about 6.5 cents.
“The payback on this investment is directly related to what it costs to heat or cool your house,” he says, noting that U.S. customers still tend to be more commercial than residential.
“The market for energy-efficient glass has expanded dramatically in the residential area, but initially it was driven by the large commercial buildings,” he says. “Certainly when you look at a skyscraper that is pure glass, your financial payback on that energy management is a lot higher than a couple windows on a house.”
“Architectural glass is our bread and butter business,” he says. “We target all three regions [the United States, Europe and China], but obviously success in China is critical to be able to grow the company. We need to stay above GDP growth rates.”
He believes that even in its small, specialized industry, the company can sustain double-digit growth in the 10%-20% range year-over year.
Behind the scenes
Edel can't name any buildings with windows made using Soleras' sputtering targets. “There's six to eight major glass producers in the world. We sell to them. There's no linkage as to who they sold their product to for a project. They produce thousands of square feet of glass,” he says.
He says a lot of companies produce sputtering targets, but only a handful of significant suppliers globally have the technical capability to produce sputtering targets for architectural glass. Three are in the United States, with two on the West Coast and themselves in Biddeford. Heraeus in Germany is his company's biggest competitor.
What distinguishes Soleras is product performance, Edel says. “For sputtering targets for the architectural glass markets, we're the largest market share supplier in the world. But that's because our largest facility is in China.”
Making higher energy-efficient windows is technology-intensive. The simplest low-e window starts at a single stack, which typically comprises five to seven different layers, each of which could have different composition and target materials. Very high-performance, low-e windows have a triple stack, or up to 21 layers. Building up the layers can get very complicated, very quickly.
The uniformity of the coating is controlled by magnetic fields in the system, Edel explains. “What enables a good producer to produce a triple layer is the ability to control the uniformity,” Edel says. “We make the equipment that can do that.” He says that while China may have 30 producers of architectural glass, only two can make triple-layer glass, maybe five or six can make double-layer glass and then the rest make single-layer glass.
U.S. and European glass makers can make triple-layer glass, because they otherwise couldn't survive in those markets, he says.
With glass panels becoming larger for both architectural and display use, being close to the customer is a must. “A lot of cost in this industry is driven by transporting the glass,” he says.
Edel adds that the architectural glass market is a good, sound market with long-term growth, but the company in 2011 did expand into coating materials for television displays and touch screen displays.
“They're using large rotary coaters for TVs, and they're also cutting down a large glass sheet into 50 smaller windows,” he says. “The idea is you get the economies of scale by driving a high-throughput, large-area process.”
Though very high tech and in Maine, Edel has been able to recruit experienced people through industry connections. Edel, a former Honeywell executive who wanted more hands-on work, looks for people in large companies who want more decision-making ability, but at a small company that is stable and profitable as opposed to a startup.
“We've managed to bring in people who have an interest in what the area's lifestyle brings, and typically they've worked at larger companies and like that smaller company feel,” he says.
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