Trouble Brewing

Trouble Brewing Less fizz in German beer

West Germans remain champion makers and drinkers of beer. Their 1,490 breweries, large and small, turn out 6,000 varieties of the beverage that they extol as "liquid bread" and that is still prescribed by some of their physicians as the best remedy for tension and insomnia. Now, however, the beermakers themselves are losing sleep. Having grown steadily for 30 years, the German thirst for lager is receding. Last year the average amount consumed by each of the nation's 61 million men, women and children was "only" 38 gallons. While that would be an astonishing level in most other countries,* it was actually off from the 1976 peak of 40 gallons. Even more upsetting, coffee has replaced beer as the country's No. 1 beverage.

Beer consumption is off for several reasons, including the sobering effect of tough laws aimed at curbing drunken driving, as well as the slowdown in the German economy that has forced 500,000 beer-loving, "guest workers" from Turkey and other countries to return home. Germans are also increasingly preoccupied with physical fitness, and the full belly that was once regarded as a sign of a healthy, jovial temperament is now seen as a sign of excess.

The effects on the long complacent beer industry and its 75,000 employees have been traumatic Over the past two years, breweries have been closing at a rate of one a week, and forecasts are that eventually only 800 will remain open. Content in the past to let their beer sell itself, some German brewers have now begun to advertise. Duisburg-based Koenig-Brauerei, for example, has a campaign that uses such luminaries as Actress Maria Schell and Moneyman Hermann Abs, former board chairman of the Deutsche Bank, who are, the ads note, "loyal to the king."

At 50-c- a half-liter bottle, beer in West Germany is priced 25% lower than mineral water or fruit juice. Still, several big brewers have been selling beer at a loss in selected markets, only to find that many Germans regard inexpensive beer as, well, cheap. Despite the interest in fitness, the light Diaet beers some brewers have introduced have flopped. Germans do not like their beer to be as robust as they used to; brands with alcohol content close to 6% are fading, and the typical beer is now 4.2% alcohol; but even those brews are more potent than the lighter U.S. beers, which are generally 3.6% alcohol.

Beer is one industry in which Germans have long prized small size. In contrast to the U.S., where the beer business is increasingly being taken over by a few large firms, led by Anheuser-Busch and Miller, the German industry is made up of many small breweries, some of which serve only a few Wirtshaeuser (pubs) in their area. The largest German firm, Dortmunder Union-Schultheiss, accounts for only 10% of the country's production.

Dutch brewers, led by Heineken, became the top beer exporters in the mid-1970s after the Germans found themselves squeezed out of foreign markets by rising costs and the climbing value of the deutsche mark. Loewenbraeu, which once exported a third of its production, stopped shipping to the U.S. last year; a version of the original Loewenbraeu is now brewed and marketed in the U.S. by Miller. But over the past three years sales of foreign beers in the U.S. have doubled. Though Heineken now commands close to 45% of this booming market, some German brewers see ample room for them too.

Wuerzburger Hofbrae'u has begun shipping beer in bulk to Anheuser-Busch, which is bottling it for test marketing in Boston, Hartford, and Atlanta. If the tests prove promising, the beer will go into national distribution. For at least some German brewers, that should help reduce tension and cut down on those sleepless nights.

*By the latest reckoning of London's Brewers' Society, Australians and Czechoslovaks rank just behind the Germans, with annual per capita consumption of just under 36 gal. of beer. Americans, who consume nearly 23 gal. a year, rank eleventh.

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