Continental's ContiTech Division to Close Four Plants in Germany

The automotive supplier Continental AG has announced plans to close four ContiTech plants in Germany as part of its ongoing restructuring efforts. The closures, which are expected to result in the loss of around 1,200 jobs, are part of the company's broader strategy to focus more strongly on business with industrial customers and improve its cost structure.

The plants in Schwalbach and Wetzlar in Hesse will be closed by the end of 2025, with work gradually relocated to Frankfurt and Babenhausen. The company has stated that some of the workforce will be relocated, but the remaining jobs will be cut in a "socially responsible" manner. The closures are expected to reduce administrative costs by 400 million euros from 2025 and lower expenditure on research and development below ten percent of turnover by 2028.



The closures are part of the company's consolidation program announced in February 2023, which aims to address the weakening Automotive division. The program is expected to result in the loss of 7,150 jobs worldwide and the merger of locations to reduce administrative costs and expenditure on research and development.

The ContiTech division, which specializes in the production of rubber and plastic products, has been struggling in recent years, with sales and profits declining. The closures are seen as a necessary step to improve the division's competitiveness and long-term prospects.



The closures are expected to have a significant impact on the local economy and workforce, with around 1,200 jobs affected in the Rhine-Main region alone. The company has stated that it will provide support to affected employees, including training programs to enhance their employability either at Continental in other positions or in the general workforce.

The closures are part of a broader trend in the automotive industry, with many companies struggling to adapt to the challenges of electromobility and the need to invest in new technologies. Continental, like many of its competitors, is facing the dilemma of unit sales and margins coming under pressure while being forced to invest in new areas.



In conclusion, the closure of the four ContiTech plants in Germany is a significant step in Continental's ongoing restructuring efforts. While the closures will have a significant impact on the local economy and workforce, they are seen as necessary to improve the division's competitiveness and long-term prospects. The closures are part of a broader trend in the automotive industry, with many companies struggling to adapt to the challenges of electromobility and the need to invest in new technologies.