Continental is to close its powertrain and interior components plant in Huntsville, Alabama, by the end of 2010 after the UAW union refused to consider wage and benefit cuts.
Continental spokeswoman Kathryn Blackwell told the Detroit Free Press the company decided to close the plant after workers there voted against opening their contract, slated to expire in 2012, to consider concessions.
At full capacity, the plant employs 1,200 people. But due to production cuts, only 972 employees have been working lately.
Continental acquired the plant with the automotive business of Siemens VDO bought in 2007. It belonged previously to Chrysler.