THE GLOBAL MANUFACTURING & INDUSTRIALISATION SUMMIT
Register
  

KNOWLEDGE HUB

By 4 March 2020, Germany had reported over 92,000 laboratory-confirmed cases of coronavirus, exceeded only by the number of cases in the United States, Italy and Spain. Yet despite having the fourth highest number of infected citizens globally, with 1,295 deaths, Germany’s fatality rate of 1.4 percent is far lower than any other country.

Compared with a 12 percent fatality rate in Italy, 10 percent in Spain, France and the UK, 4 percent in China and 2.5 percent in the United States, Germany had managed to save far more lives than even South Korea, heralded as a model for flattening the curve, who has a higher fatality rate of 1.7 percent.

So why is Germany’s death rate so low?

Experts believe it is the result of a blend of factors including higher testing levels allowing them to identify asymptomatic carriers, and the large number of intensive care beds Germany already had and has since added to.

For instance, by mid-January, long before the coronavirus had captured Europe’s attention, Charité hospital in Berlin had already developed a test and posted the formula online allowing laboratories across the country to build up a stock of test kits and begin testing. Germany is currently conducting around 350,000 coronavirus tests a week, far more than any other European country.

The ability to undertake widespread testing has allowed the authorities to isolate known cases while they are infectious to slow the spread of the pandemic. It has also enabled lifesaving treatment to be administered in a timelier way – providing medical intervention for patients before they become critically ill and increasing their chance of survival.

Germany’s low fatality rate of the coronavirus is also likely to be due to the fact the country is the country is by far the best equipped, with 28,000 intensive care beds equipped with ventilators, or 29.2 beds per 100,000 people. At the other end of the spectrum, Portugal has just 4.2 beds per 100,000 people, whilst the Netherlands, Slovenia, Finland, Greece and Sweden all have fewer than 6.5 critical care beds per 100,000 people. Yet despite being so far ahead, hospitals across Germany added to their ICU capability and now the country has more than 40,000 intensive care beds, with ventilators, available.

Commentators are also contributing Germany’s successful coronavirus strategy to the strength of its leadership. Chancellor Angela has communicated clearly and regularly throughout the crisis. The restrictions, which have been crucial to slowing the spread of the pandemic, have been met with little political opposition and are broadly followed by the population.

“Maybe our biggest strength in Germany is the rational decision-making at the highest level of government combined with the trust the government enjoys in the population.” said Professor Kräusslich, the head of virology at University Hospital in Heidelberg, one of Germany’s leading research hospitals.

Part of this favour seems to come from widespread agreement with Germany’s strategy to keep the economy moving. Despite extensive social distancing and lockdown measures in place, most of the country’s factories remain operational. As a result, German manufacturing suffered a far smaller contraction last month, than comparable sectors in France and the U.K., according to data published by Markit.

In fact, German manufacturers are running at as much as 80% capacity, according to industry estimates. Indeed, Holger Paul, of the German Mechanical Engineering Industry Association said closures “are not a phenomenon widely spread among our 3,300 member companies”.

For instance, Gordon Riske chief executive of Kion Group AG, which builds forklift trucks and warehouse equipment, is still producing at its German factories despite disruptions in its international supply chains. The company put together a crisis team at one of its factories in China as it went into lockdown and their health and safety strategy was then rolled out across European sites as each country followed suit. “It’s extremely important to keep factories running. Perhaps this won’t go away so quickly,” Mr. Riske explained.

Meanwhile, HAWE Hydraulik SE, a Munich-based manufacturer of hydraulic pumps and valves, says new working methods – including new shift patterns to ensure the same workers always work together and a requirement for workers to maintain a minimum distance of 1.5 meters – mean the company is operating its six German plants at near 100% capacity. In addition, chemicals giant BASF’s management team has focused on ensuring workers agreed and complied with new safety measures including new cleaning processes which has allowed infections to be minimal and production to continue. Applying a co-operative approach has ensured that BASF factories were quick to get workers and Unions on board which allowed them to continue their operations relatively quickly.

Another key factor in how Germany is able to keep manufacturing moving is its longstanding commitment to incorporating digital technology to its production systems and processes. Its ‘Industrie 4.0 strategy’ was designed to prepare German companies for the digital age, or the fourth industrial revolution (4IR). Incorporating technology such as artificial intelligence, big data, machine learning and automation throughout production lines meant Germany has many examples of ‘smart factories’. Indeed, Industry 4.0 technology has rapidly become an integral part of the manufacturing and industrialisation industry in Germany, helping to optimise logistics, production and crucially, enhancing the ability to plan ahead.

Whilst utilising the 4IR as a competitive strategy made sense last year, during the coronavirus crisis, it is allowing Germany to pull away from less tech-savvy countries due to the number of tasks manufacturers can complete without human workers. For example, for several years now, Volkswagen has been using RFID (radio frequency identification) technology to capture data from components fitted with sensors to test vehicles faster. The sensors allow engineers to identify the installed prototype parts effortlessly and display detailed information they need for development. Being able to work alongside this technology allows human workers to reduce contact with others, whilst continuing to meet business objectives and goals.

Whilst governments around the world scramble to compile an exit strategy from the lockdowns and restrictions imposed, it is likely that Germany, and its ability to move swiftly in order to protect industry and keep factories working, suffer less in the long term, as a result.

According to Lars Feld, Chairman of the Council of Economic Experts, every week of lockdown costs the German economy around 1% of gross domestic product, or about $40 billion and therefore maintaining a heartbeat in manufacturing keeps this cost as low as possible.

The coronavirus has devastated families, companies and economies the world over, and yet worryingly, we may not even be at the worst of it yet. The longer the crisis continues, the harder it will be to revive economies on the other side. Therefore, Germany’s ability to conduct widespread testing, ensure adequate levels of medical technology to treat the sick, and keep its manufacturing sector working – is likely to put it ahead of others once the crisis abates. It is perhaps too early to draw lessons from this global pandemic, but what is becoming clear is that commitment to technology is affording Germany options that are allowing it to soften the blows.

WANT TO KNOW MORE?

Subscribe to our newsletter.