Product piracy damages mechanical engineering in the billions

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Study 2020: Annual damage of 7.6 billion euros; Many counterfeits pose a threat to the operation of machines and plants; China remains the main sales country for plagiarism; Companies sue product pirates less and less frequently

Product and brand piracy causes billions of euros in damage in the mechanical engineering industry, and this has become even greater in the last two years. According to the current study "Product Piracy 2020", the annual damage has now grown to 7.6 billion euros - in 2018 it was still 7.3 billion euros. A turnover of this amount would mean the equivalent of almost 35,000 jobs in the mechanical engineering industry. "What is shocking is that 57 percent of the companies report counterfeits that pose a danger to the plant. This shows that plagiarism is not a trivial offence, because operating fake machines or systems with fake components can pose a real danger to the operator," says Steffen Zimmermann, head of the VDMA Competence Center Industrial Security.

Every two years the VDMA surveys its member companies on the threats and effects of counterfeiting. In the current study, which was carried out by the Fraunhofer Institute for Applied and Integrated Security AISEC on behalf of the VDMA, 74 percent of the companies questioned stated that they were affected by product piracy, and in the case of companies with more than 500 employees, this proportion even reached 90 percent - both are new record figures. "A trend reversal can also be seen in the perceived threat from counterfeiters. While this figure had recently dropped to 39 percent, 52 percent of those surveyed now spoke of an increase in the perceived threat level," summarizes Zimmermann. The trade in counterfeit machines and components is flourishing particularly strongly in China. The People's Republic is named as the most important country for the sale of counterfeit machines (61 percent), followed by Germany with 19 percent. In third place for the first time is Russia with 12 percent.

Competitors are usually the clients

Most of the companies surveyed name competitors (72 per cent) as clients for plagiarism, but business partners such as customers, suppliers or joint venture partners are also seen as the starting point for counterfeiting (41 per cent). The most common counterfeit is individual parts (64 percent), followed by design plagiarism (60 percent). Entire machines are also brought onto the market as fakes (40 percent).

The companies have little hope of being reimbursed for the damage caused by taking legal action in court. Only 26 percent of the companies surveyed even initiate civil court proceedings - in 2018 the figure was 39 percent. About half of the respondents completely refrain from taking any action. "Small and medium-sized companies in particular seem to be increasingly resigned or shying away from the effort of taking legal action," says VDMA expert Zimmermann.

The complete study "Product Piracy 2020" can be found here.

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