Continental has announced a restructuring to its manufacturing footprint over the next decade as it says an accelerated transition to electric mobility necessitates adjustments and the phasing out of production for combustion engine components at several locations worldwide. Over 5,000 jobs will be affected by the changes over the next ten years.

The company's Supervisory Board has today approved the structural adjustments at the locations in Roding and Limbach-Oberfrohna (Germany), Newport News (US) and Pisa (Italy).

Continental says that in recent months the management and the works councils at the affected locations have discussed the situation and the next steps.

Continental will discontinue its business in hydraulic components for gasoline and diesel engines 'in the coming years' (the plan goes through to 2029). This, it says, is against the backdrop of the automotive industry's disruptive transition to electric mobility, which has been accelerated by stricter emissions laws, resulting in a 'drastic decline in demand for hydraulic components'.

In a further resolution, the Supervisory Board approved the structural adjustment at the Babenhausen location in Germany, in line with the decision to phase out production of display and control technologies there by the end of 2025. Moreover, certain research and development activities in Babenhausen are to be transferred to other locations by the end of 2021. This, the company says, is necessary due to the industry's abrupt switch from analog to digital technologies, as well as a rapidly deteriorating competitive situation and a corresponding sharp increase in cost pressure.

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In addition, the company's management informed the Supervisory Board that talks will be held as soon as possible with the local works council in Rubí (Spain) about the future prospects of the location. The company currently employs around 760 people in Rubí, producing mainly analog displays and controls.

Continental's CEO Dr. Elmar Degenhart said: "We are making good progress. With its resolutions today, the Supervisory Board is supporting our urgently needed technological transition and thus the strengthening of our competitiveness and future viability. We are focusing on profitable growth areas, quickly and rigorously. These include assisted, automated and connected driving; services for mobility customers; and the tire, industrial and end-customer businesses. The jobs of the future will evolve in these growth areas."

Referring to the next steps, Degenhart added: "We have been holding intensive, constructive talks with employee representatives for some time. The crucial question now is: how can we implement the necessary measures responsibly and with foresight so that we can emerge stronger from the current reorganization. We will be supporting those employees affected as much as possible."

Continental, together with employee representatives, has expanded its corporate-wide internal job market considerably for employees affected by the structural program. Furthermore, the company recently founded the Continental Institute of Technology and Transformation (CITT). This offers employees tailor-made training courses, seminars and further education, which will retrain them for other tasks. The aim is to offer employees long-term career prospects and greater employment opportunities. In this way, they can retrain for jobs on the internal as well as the external employment markets, Conti says.

In total, some 5,040 jobs are impacted by the plans:

Roding (Germany): Discontinuation of production and development of hydraulic components for gasoline and diesel engines (high-pressure pumps) in 2024, resulting in the closure of the location. As things stand, around 520 jobs will be affected.
Newport News, Virginia (US): Closure of the location in 2024, where around 720 people are currently employed. Hydraulic components for gasoline engines (injectors) are manufactured at the plant.
Limbach-Oberfrohna (Germany): Discontinuation of the hydraulic components business for diesel engines (injectors) in 2028. As things stand, around 850 jobs will be affected at this location.
Pisa (Italy): Discontinuation of production of hydraulic components for gasoline engines (injectors) from 2023 to 2028. As things stand, around 750 jobs will be affected at this location.
Babenhausen (Germany): Phasing out of production of display and control technologies of the Instrumentation & Driver HMI business unit by the end of 2025. Moreover, certain research and development activities are to be transferred to other locations by the end of 2021. As things stand, over 2,200 jobs will be affected. The business unit will continue to be managed from Babenhausen, including development and administration activities.