Masks Made in Germany

More than most countries in the wake of the coronavirus pandemic, Germany is ramping up production of protective facial masks. An opportunity for companies working in the sector? We put that question to GTAI health expert Gabriel Flemming.

June 2020

More than most countries in the wake of the coronavirus pandemic, Germany is ramping up production of protective facial masks. An opportunity for companies working in the sector? We put that question to GTAI health expert Gabriel Flemming.

Is Germany trying to become nationally self-sufficient in the production of masks?

No, Germany doesn’t question globalization and continues to place great value on open markets. Nevertheless, to avoid unnecessary risks, Germany cannot allow itself to become dependent on any individual countries. The global coronavirus pandemic has shown that populous countries like Germany need to emphasize national production, among other things to prevent situations in which individual nations are forced to compete with one another for essential, life-saving protective equipment. The goal is not autarky, but rather a strategic mix of high-quality local products, diversified imports and the establishment of limited reserve stocks for worst-case scenarios. That includes the capacity to help EU partners in catastrophes, should that be necessary.

So are the efforts to increase mask production national or EU-wide?

The federal German government has created programs to incentivize domestic production. It’s also actively supporting innovation to create better products (in terms of recyclability, re-usability and comfort) and better production technologies that will be profitable in the long term. That applies not just to masks, but to the entire value chain, for example, non-woven fabric as a constituent material. At the same time, such programs only make sense if they’re coordinated at the European level, which is the case here. The non-woven fabric and masks produced as a result of these programs are explicitly reserved for use in Germany and EU countries. However, once demand in Europe is met, the Ministry of Economic Affairs and Energy can also permit sales outside the EU.

Are we talking about all types of masks here or just the ones used in hospitals?

The requirements of masks in the healthcare sector, as well as for elderly and high-risk users who require greater protection, are of course different from those for general usage. So we need a variety of masks. Moreover, it makes a big difference whether a mask is worn only briefly or for an entire day. German employers are required to provide professional protective equipment to their employees if mandated 1.5-meter distancing isn’t possible. The governmental support programs in question are specifically for mouth-and-nose protective medical masks and FFP2/3 masks. They have to meet set European and German quality standards.

High-risk mask © DACH

How big are the German and European markets for masks?

In Germany the market is estimated at between EUR 8 and 12 billion. The entire European market depends on a variety of factors, in particular, the further course of the corona epidemic, the availability of a vaccine and the resulting regulations of the countries concerned. An additional factor is the attitudes of individual populations. Broad popular acceptance of masks like in Japan would mean a huge surge in demand even beyond the 12 billion a year.

What about companies like TRIGEMA that began producing masks as an emergency measure during the crisis? Will they continue to make them or return to their main activities?

There will certainly be a market for reusable masks that are breathable and comfortable to wear, as most cloth masks in fact are. There has also recently been a fashion trend toward attractive designs. Around 40 percent of businesses that are members in German Confederation of the German Textile and Fashion Industry have gotten involved in producing masks. One question is whether someday they will have to prove that their masks provide a certain level of protection. The question whether it will be profitable for textile companies to produce masks is one that will have to be decided individually. Prices have now begun to fall, so competition is definitely increasing.

Do foreign companies stand a chance in this sector?

Absolutely. We have just completed a study of mask production in Germany and summarized our findings in a presentation. We concluded that there are definitely interesting business opportunities for foreign producers. These could be newly founded subsidiaries of companies previously not active in Germany or companies already present in Germany that want to expand their business here. We’re happy to provide companies that are interested with our presentation, discuss the implications and support their projects in Germany.

How great is the risk that mask-wearing requirements will be lifted and that companies will be stuck with large numbers of excess products?

Mask-wearing requirements will surely be lifted when the virus has disappeared, but there’s no telling when that will be at the moment, even if the infection situation has improved. Right now, we have neither approved medications nor a vaccine for the coronavirus. They might come next year, but that’s far from certain.  For producers it is important to be highly efficient and competitive even in a normalized market situation. In the long term, this is only possible using advanced technology, which is what the federal German government is explicitly trying to encourage. Companies don’t have to go it alone here. They have a broad spectrum of technological partners at their disposal, including research institutes and cutting-edge local suppliers in innovation clusters. GTAI can assist companies in finding partners to accelerate innovation and diversify risk.

If you would like more information or would like to contact Gabriel Flemming and the other members of the GTAI life sciences team, please click here

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