Although Continental doesn’t plan to cease production at its Aachen factory in Germany until next year, it isn’t making any tyres at all there at the moment. Corona virus is to blame for this pause in production. To date, 19 of the 1,800-strong workforce has tested positive and a further 130 have been quarantined. Continental has thus stopped work at the site until the end of 26 May.
Tyre production at the Continental plant in Aachen, Germany will cease at the end of next year, if not earlier. This is one of the outcomes of talks between the company and representatives of Aachen plant employees. Continental has also published details of upcoming retraining programmes.
Financial analysts have reiterated their “buy” rating on Continental AG shares, while also raising price target from 150 euros from 123 euros previously. In short, Continental AG is expected to continue outperforming consensus estimates. Writing in an investors note dated 18 November, Jefferies equity research said: “Tyre margins will return to an industry leading greater than 15 per cent in full-year 2021. Conti remains among the least liked stocks in the sector which provides positive surprise potential.”
It is somewhat ironic that the number 2020 has inherent associations with perfect vision and yet this year has turned out to be the most unpredictable in a lifetime. For example, no-one saw President Trump’s twitter-borne sideswipe at Goodyear’s tyres coming last month – how could they? However, on a more serious note, the effects of uncertainty has real-life impact. And this month has seen more than its fair share of such harsh realities in the tyre industry.
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The supervisory board of Continental AG has approved the executive board’s decision to discontinue production at the manufacturer’s plant in Aachen, Germany by the end of 2021. The supervisory board confirmed the executive boards decision during a board meeting today (30 September 2020). The closure decision will affect around 1,800 out of the about 2,000 jobs located at the Aachen site.
Following the closure of Continental’s Aachen, Germany tyre production facility, Tyres & Accessories asked representatives of the company’s UK operation (Continental Tyre Group) what the impact will be on local customers. In short, the company is aiming to continue “high quality” service.Following the closure of Continental’s Aachen, Germany tyre production facility, Tyres & Accessories asked representatives of the company’s UK operation (Continental Tyre Group) what the impact will be on local customers. In short, the company is aiming to continue “high quality” service.
The union representing employees at a closure-threatened Continental factory has responded angrily to the decision, accusing Continental of “sacrificing” a “profitable tyre plant” as part of its savings programme. The IG BCE union particularly doesn’t understand the logic behind this step as it claims the tyre business in Aachen has achieved “double-digit” profit margins over the years and even operated in the black during the corona lockdown.
Employees at Continental AG’s Aachen, Germany tyre factory were informed that the plant will be closed by the end of 2021. According to the German Handelsblatt newspapter, more than 1,800 employees will be affected by the closure. The announcement comes two weeks after Continental announced cost-cutting plans aiming at saving 1 billion euros by 2023.
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Continental AG