With an optimal location in the heartland of Europe and a supportive based carrier in Lufthansa, MUC operates as a primary interline hub as well as serving its own region. They have lucrative destinations to offer from all directions of the compass rose. MAN has to rely on its core indigenous regional market stretching from the English Midlands and North Wales upto the Scottish border. That is a great hinterland catchment but MAN is simply not advantageously placed geographically to serve as anything other than a hub for certain niche markets. In normal times (non-covid), MAN can look to destinations such as IOM, BFS and ABZ to feed its onward flights. MAN does also have Eire to the West, though DUB offers a very similar slate of destinations to those available via MAN. But MUC is ideally placed geographically to serve as a true short-haul (and long-haul) crossroads for an entire continent. It is a whole different ballgame for them.
MAN will pick up some interline traffic on routes such as those to the USA and Caribbean, but these passengers are generally price-led and represent a very modest percentage of total boardings. And the heyday of this trade was when the Thomas Cook Transatlantic services were at their peak offering very generous fare deals. Who can say whether Virgin and Aer Lingus will make serious inroads into this market going forward?
So MAN will continue to enjoy a modest top-up from interline traffic (which is always welcome). But interline is absolutely fundamental to the business model at MUC. Geographical location provides that option for MUC; MAN at the Western periphery of Europe simply isn't central enough to pitch for that role. MAN cannot entertain pretentions of competing on the scale of a centrally-located European hub for interline volume - it can't happen. Of course, MAG is well aware of the strengths and weaknesses of its market reach, so they aren't trying to emulate MUC's primary hub model. However, every so often, outsiders pop up on a forum such as this to query why they don't.