^{1) incl. Revenues from owned foreign production}
_{Source: Certified Revenue Survey by the VDDI of its members}
 

Corona crisis wipes out successes

Up to early March, our industry appeared to be in a positive economic situation. With total sales of 5,249 billion euros (+4.1 %), of which 3,204 billion euros were generated by export business (+2.6 %) and 2,046 billion euros by domestic sales (+6.3 %) in Germany, the German dental industry was able to hold its own in 2019 despite tougher competition. This is apparent from the results of the association survey held at the beginning of this year. But that is history. By the end of March, our figures were really only of historical interest. When the corona crisis hit the global economy with unparalleled force, our successes also were turned into waste paper in one fell swoop. The corona crisis also sucked our dental industry into the maelstrom.

Severe impairment of the dental industry by the corona crisis

National and even global lockdowns and curfews have restricted the social mobility of people in order to reduce the risk of infection. This has resulted in a sharp drop in demand from patients for dental care which was exacerbated by a lack of PPE for dental practice staff. A sharp rise in worldwide demand quickly led to bottlenecks in supplies, and dentists saw their obligation to treat patients endangered. Stockpiling by market players from outside the industry led to temporary bottlenecks for disinfectants and anaesthetics, and suppliers of basic materials were unable to deliver the usual amounts. Suppliers of materials and containers were no longer able to deliver, and well-established supply chains collapsed.

In May, the BZÄK (German Dental Association) reported a sharp drop in turnover in dental practices. Between February and April, the volume of work fell by 50 %, with two thirds of practices furloughed. Dental technology, the next link in the value chain, has been hit even harder: 90 % of dental laboratories have imposed extensive furloughing and 80 % of them applied for emergency government aid. According to the VDZI (German Association of Dental Laboratories), incoming orders in dental laboratories in April are tantamount to a work stoppage. Our industry, comprising manufacturers of dental medical technology, is very seriously affected by this.

What happens next?

The EU and German government are launching economic stimulus packages on an unprecedented scale to revitalize the European economy and combat the global economic crisis in addition to the health crisis. An EU financial injection of 750 billion euros is intended to support poorer and heavily indebted countries. The German government's economic stimulus package with a volume of 130 billion euros aims to secure jobs and boost the economy.

What are the prospects?

Many governments will start to gradually relax the strict health lockdown in the summer. There are good prospects of a slow improvement, but experts rule out a rapid return to the previous year's results.

The EU's spring forecast predicts a recession of historic proportions. The economy in the eurozone will shrink by 7.7 %, economic output will fall by 7.4 % in the current year, but will rise again next year by 6.4 %. By the end of 2021, the EU economy will not be able to make up for the losses sustained this year.

^{June 2020}