Analysts Believe Charlotte Plant Closure Inevitable

Continental’s Charlotte, North Carolina, plant is likely to close happen when the company’s Brazilian operation is fully operational in 2007, Deutsche Bank analysts have reported. The analysts’ comments come after the plant’s management asked workers to choose between a 35 per cent wage reduction (from $21/hour to $13.7/hour) and production cuts in order to save $15 million dollars a year.

“Whatever the decision taken by the workers, we still believe that when (Conti’s) Brazilian operation will be fully operational (ie in 2007), Charlotte will be permanently closed and its production will be fully transferred to Brazil,” the analysts reported.

Six months prior to this request, Continental executives reduced the Charlotte plant’s workforce by 300 (30 per cent). The plant produced 7.7 million passenger car tyres in 2004.