Germany - Aerospace/Defense/Security Germany - Aerospace/Defense/Security
OverviewTotal market size = (total local production + imports) – exports
Aerospace & Defense Market in USD millions (The security market is not reflected in the table but in the written paragraph below.)
|Total Market Size||31,433||30,573||29,959||29,680|
|US Imports = US Market Share||5,801||6,860||8,917||9,000|
|EUR-USD Exchange Rate||1.1069||1.1297||1.1810||1.14 projected|
U.S. aerospace & defense manufacturers produce the highest trade surplus of all manufacturing sectors, year after year. According to TradeStats Express - a U.S. Department of Commerce database showing the latest global patterns of U.S. merchandise trade - the 2018 U.S. aerospace exports to Germany amounted to $8.92 billion. The trade surplus was USD 6.36 billion, representing a 67 percent increase over 2016 (USD 3.8 billion). These figures are in stark contrast to the European statistics stating exports of USD 1.49 billion. This is due to a different approach in assessing the sale of sub-systems and components. Aerospace & defense is complemented by homeland security & public safety, an industry spanning across 16 vertical markets with a projected global turnover of more than USD 400 billion in 2019. U.S. manufacturers are well-positioned to benefit from a robust market growth in Western Europe, especially Germany.
Germany hosts the world’s third-largest trade show for aerospace & defense (ILA Berlin Air Show), the world’s largest trade show for aircraft cabin interiors (Aircraft Interiors Expo / AIX) and Europe’s largest trade show for general aviation (AERO), making it an ideal platform for U.S. companies to meet with their global partners and buyers. The major safety & security shows that are relevant for the German market are held in Essen (Security Essen), but also in London (DSEI) and Paris (Milipol).
Leading Sub-SectorsGermany has the third-largest aerospace & defense market in Europe, with 2018 revenues at USD 47.2 billion, following the UK at GBP 78 or USD 104.2 billion (including land defense systems) and France at USD 77.2 billion. Some three-fourths or USD 35.5 billion of the German production are exported. France received a third of the exports with USD 12.3 billion. Airbus intra-company trade makes up the largest portion of these exports, as part of their geographically dispersed production model with several major sites in Germany and France. The German homeland security & public safety market amounted to USD 20.3 billion in 2017. This figure was published at the “Security Essen” trade show in August 2018. It is slightly higher than the USD 19.2 billion quoted in the previous version of this report. The industry will see steady growth rates until 2020, mostly due to ongoing upgrades of the German internal security and migration enforcement infrastructure and an increased need for security services. The security services market makes up 50 percent of the overall market and grew by 2.5 percent to USD 10.34 billion in 2018.
Aerospace is a German Government priority. The Federal Ministry of Economic Affairs and Energy (BMWi) lists aerospace as a key industry with high growth rates and a strong industrial core in Germany. The revised and updated “2018 Technology Strategy of the German Aerospace Industry” builds on BMWi’s earlier “Aerospace Strategy”, underlining the particular importance of the aerospace sector for Germany as an industrial country both technologically and economically. Besides aiming at increased competitiveness, the aerospace sector promises to make significant contributions to overarching societal goals, especially with regards to climate, noise and environmental protection. Moreover, BMWi has initiated the 6th iteration of the Aerospace Research Program (LuFo)—a grant program for aerospace research and technology projects—in the fall of 2018. Best prospects for U.S. exporters exist in the following segments: commercial aircraft, business jets, turboprops, helicopters, UAVs, structures, propulsion systems, subsystems for aerospace vehicles; military aircraft, air defense systems; spacecraft, launch systems, communications systems; access control, identity management, integrated systems, security services.
The main vertical markets for homeland security & public safety in Germany are airport security, smart borders, telecommunications and critical infrastructure and police modernization.
Policy Objectives and Challenges
U.S. suppliers should be aware of the effects of the U.S. Export Control Reform (ECR) regarding changes to the EAR and ITAR for U.S. aerospace & defense companies. The Commercial Service will continue to support U.S. companies by conducting frequent and active outreach to the Bundeswehr’s Federal Office of Equipment, Information Technology and In-Service Support (BAAINBw) in Koblenz, and following the latest aerospace, defense and security policy developments and discussions in Germany. On an international level, we will gain insight from organizations, such as the Aerospace and Defense Industries Association of Europe (ASD), the U.S. Aerospace Industries Association (AIA) and Homeland Security Research (HSR) in Washington, D.C. to understand their positions on transatlantic trade issues and communicate U.S. objectives.
In a number of recent tenders, the German military and some state police forces have imposed non-ITAR/EAR/PESCO clauses on prospective bidders, asking them to attest that their products do not fall under the respective regimes. This excludes many U.S.-designed and U.S.-made defense-sector goods.
OpportunitiesOpportunities include a 4.5 gen fighter jet program for the German Air Force; anti-submarine warfare (ASW) / anti-surface warfare (ASuW) helicopters for the German Navy; exo-atmospheric engagement systems for German F124 frigates; Search and Rescue (SAR) helicopters for the German Federal Armed Forces (Bundeswehr); heavy lift helicopters for the German Army; gas turbines for 4 multi-role combat ships (MKS 180) for the German Navy; Scalable Space Inertial Reference Units (SSIRU-L) for SARah, Germany's radar reconnaissance satellite constellation; integrated air and missile defense system (TLVS) for the Bundeswehr; large twin-engine transport helicopters for the German Federal Police; lightning detection services to help support the aviation industry clients of the German Meteorological Office (DWD).
Web ResourcesTrade Events
- DSEI , London, September 10-13, 2019
- inter airport Europe, Munich, October 8-11, 2019
- Aviation Forum, Munich, November 5-6, 2019
- Milipol, Paris, November 19-22, 2019
- Aircraft Interiors Expo, Hamburg, March 31-April 2, 2020
- AERO, Friedrichshafen, April 1-4, 2020
- ILA Berlin Air Show, Berlin, May 13-17, 2020
- Farnborough International Airshow, London, July 20-24, 2020
- Security Essen, Essen, September 22-25, 2020