Continental plans to close several factories around the world

Continental A.G.'s solution to close a tire plant in Aachen, Germany, is part of a global restructuring project that will ultimately affect up to 30,000 jobs worldwide.

Conti's board of directors, citing the "deepening economic crisis" caused by the coronavirus pandemic and its impact on auto parts and tire sales, approved a restructuring plan on September 30 that includes at least four factories in North America, numerous factories in Germany and other production sites.

The restructuring is expected to save about $1.17 billion by 2023. The company previously considered a restructuring plan covering 20,000 jobs around the world and saving more than $580 million a year.

“The current crisis is the most significant we have experienced in 70 years,” said Elmar Degenhart, Chief Executive Officer of Continental. “Our current goal is to prepare for sustainable success and ensure the future viability of the company. As important as these decisions are for our future, the consequences can be just as painful for employees.”

The restructuring will affect Continental's tire production, with plans to close its tire plant in Aachen, Germany. The plant will be closed by the end of 2021, after which 1,800 of 2,000 jobs will be cut. The decision to close the company explains the need to ensure the competitiveness and long-term success of European tire production in the face of reduced market demand for certain types of tires.

However, Continental confirmed that it continues to invest in Germany, including its Taraxagum Lab Anklam in Anklam, where the company is exploring the possibility of using dandelion rubber as an alternative source of raw materials for tire production.

The planned restructuring will affect thousands of jobs in North America. The company plans to close four plants: an engine components manufacturing facility in Newport News, Virginia (740 employees); the Henderson County, North Carolina Hydraulic Brake Components Plant (650 employees); an auto parts plant in Culpeper, Virginia (200 employees); and an automotive electronics manufacturing facility in Nogales, Mexico (2,000 employees).

These factories are due to close in 2024, with the company planning to transfer some of its employees to its other businesses.

In addition, three Continental plants are slated to close in Europe: two German plants in Roding and Limbach-Oberfrona, where components for gasoline and diesel engines are produced, and a plant in Pisa, Italy, which specializes in the production of hydraulic injectors for gasoline engines.