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Automotive components giant, Continental, slashes thousands of jobs globally
In an upcoming corporate overhaul, German automotive supplier Continental will axe a striking number of positions worldwide. The Hanover-based firm announced their cost-reduction plan on Monday, anticipating a significant impact on around 4,000 jobs globally - including over 1,000 in Germany. Previous reports suggested 5,500 job cuts, including those within Continental's home country.
Continental strives to reclaim over 400 million euros annually, starting from 2025, by simplifying and streamlining their business and administrative structures. Philipp von Hirschheydt, Member of Continental’s Executive Board, explained that these initial measures are pivotal in enhancing the Automotive sector's competitiveness.
Further restructuring could follow, as the company focuses on reviewing all processes, from sales to research and development, and manual labor units. Von Hirschheydt insists they are open to collaborating with labor partners to implement suitable measures.
Initially, it appears that administrative roles are primarily targeted for job cuts, with production and development sectors, as well as tire manufacturing, seemingly unaffected. The magazine "Manager Magazin" reports that Continental's Executive Board is reacting to long-term struggles in the automotive division.
According to the report, a significant portion of Continental's workforce (approximately 100,000 worldwide and 25,000 in the directly affected area) work in the automotive division.
Continental relies on a broad portfolio of products for the automotive industry, including conveyor belts and blow mold tools. However, persistent demand fluctuations and economic pressures, including the shift towards electromobility, require Continental to invest in new technologies, continually adjusting its operations to meet these evolving market demands and securing its future growth.
- In an effort to boost its cost-reduction targets, Continental plans to cut thousands of jobs as part of its global cost-saving program, affecting jobs predominantly in the administrative spectrum.
- The Hanover-based firm aims to safeguard 400 million euros in annual savings by 2025, squeezing profits from streamlining and reorganizing its business and administrative structures.
- Although initial restructuring efforts focus on administrative roles, Continental is open to further adjustments across all departments, including sales, research and development, and production, in a bid to maintain its market competitiveness.
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Continental's ContiTech division - which manufactures conveyor belts and blow mold tools for the automotive industry, among other products - has announced a series of significant job cuts and restructuring measures across its global operations.
In recent years, Chancellor Angela Merkel's administration has encouraged a shift towards electromobility and sustainable transportation, while Germany's coal lobby has waned, impacting ContiTech's core sectors. This transition is compounded by evolving market demands and the need for higher investments in new technologies, putting pressure on the division to restructure.
Facing these challenges, ContiTech will close four of its facilities, downsize two others, and reposition activities at the Hamburg location, with one production unit shifting to an automotive site, resulting in around 1,200 job losses in the Rhine-Main area alone. Further reductions are expected across ContiTech's global operations by 2025, as the company looks to reduce its administrative costs and research and development expenditure.
