The hearing aid industry isn’t feeling the effects of Trump’s tariffs
The three main hearing aid companies are concentrated in just 25 km, all in Denmark, but so far they have been spared from the duties of the United States, which represents one of the most important markets for a sector worth around 12 billion dollars. Facts, numbers and comments
In a world marked by trade wars, industrial concentrations and technological innovation, there is one sector that for now manages to escape tariffs and remain firmly in European hands: that of hearing aids.
Valued at approximately $12 billion , this market is dominated by a small group of Danish companies who, thanks to a combination of advanced technology, established industrial ecosystem and regulatory advantages, maintain a near global monopoly.
And while the United States remains the most important market, thanks to the tariff exemptions these devices benefit from, these companies may not feel the effect of tariffs even in the near future.
THE KINGDOM OF HEARING AIDS
North-west of Copenhagen, between forests and lakes, lies the so-called "Silicon Valley of Sound", an industrial district that leads the global hearing aid market. In fact, within a radius of just 25 kilometers, the three main companies are based – Demant, GN Store Nord and WS Audiology – which, together with their Swiss rival Sonova, dominate a billion-dollar sector.
THE EUROPEAN OLIGOPOLY
Hearing aids are made by a few manufacturers, almost all of them European. According to Morgan Stanley , the top five control 99% of the global market, which was worth about $12 billion in 2023 and is expected to exceed $14 billion in 2025. Only one of these five companies – untraded Starkey – is based in the United States. Europe, therefore, and in particular the Danish cluster, remains the center of gravity of this highly specialized sector.
SAVED FROM DUTIES THANKS TO THE NAIROBI PROTOCOL
Already during the first term of US President Donald Trump, the hearing aid industry was exempted from the tariffs imposed on many European products and even in this new flurry of measures it continues to be excluded.
In fact, hearing aids fall under Chapter 98 of the United States Tariff Schedule, which lists duty-free products. As Sonova CEO Arnd Kaldowski explained to Bloomberg , "it is based on what is called the Nairobi Protocol, designed for devices intended for people with permanent disabilities." “From our point of view – he added -, we feel reasonably confident” that the current exemptions will remain in force.
PRODUCTION, SALES AND COSTS
European companies produce their devices around the world, from Denmark and Poland to Mexico, China and Malaysia, to serve a global market, with the United States driving demand. Sonova, for example, derives 30% of its turnover from the USA, while Demant 41%.
According to Bernstein analysts cited by Bloomberg , a high-end hearing aid sold in the United States can cost between $6,000 and $8,000 per pair, including adjustment services. Which is why analysts warn that the introduction of duties in this sector could have direct effects on consumers, reducing access to an essential device for millions of people, especially elderly people.
NEW SEGMENTS (AND NEW COMPETITORS)
Despite the Danish oligopoly, some companies are attempting to enter the less well-attended segment of mild to moderate hearing loss. This is the case of the French giant EssilorLuxottica , which has obtained authorization for a new line of glasses with integrated hearing technology.
However, one thing that does not appear to be at risk at the moment is European leadership in the hearing aid sector. For Graham Doyle , analyst at the UBS group: “Technical skills, production scale and a crucial commercial platform – guaranteed by direct control of sales points – will ensure that Europe dominates the hearing aid sector in the medium term”.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/il-settore-degli-apparecchi-acustici-non-sente-gli-effetti-dei-dazi-di-trump/ on Thu, 15 May 2025 11:06:19 +0000.