Hannover-based Continental AG is a leading automotive supplier and – according to the company – is “the choice of leading car manufacturers, offering award-winning tyres that deliver responsive braking in all weather conditions.”
Continental has reported its Q3 2020 financial results, and these are better than many expected. Although quarterly consolidated sales of 10.295 billion euros were 7.3 per cent below the 11.303 billion euros reported in Q3 2019, the adjusted EBIT margin of 8.1 per cent was 2.5 per cent higher. The Rubber Technologies division, which includes Continental’s tyre business, was crucial to this success.
Following the reports that Continental is in talks to sell off various parts of its wider group, analysts have responded positively to Siemens’ recent sale of its Energy division, saying it is good for Conti.
Upgrading their rating to “buy”, Jefferies analysts said: “Siemen’s recent spin-off of Energy gives confidence that Conti’s share price will benefit from its planned spin-off of Vitesco as the combined market cap of Siemens and Energy was up 7 per cent on the day of transaction (DAX +3%)” The implication, they explained, was that there was a discount in Siemens’ sum-of-the-parts valuation. That being the case, given Conti’s “more attractive transaction structure”, the analysts predicted that Conti’s “re-rating should be more pronounced.”
The recent news that Continental AG will close its Aachen, Germany tyre factory underlines the fact that it is aiming to cut 13,000 of 59,000 jobs in Germany as part of a major group-wide cost-cutting programme. Now, the German Manager Magazin is reporting that Continental is also considering the sale of parts of the wider group. Indeed, Continental is said to be in talks “already with prospective customers”. The Rubber Technologies business sector, which includes Continentals Tire and ContiTech division is also said to be affected.
About a year ago Continental announced its selection as a tyre supplier to the ID.3, and under this arrangement is providing original equipment EcoContact 6 summer tyres, WinterContact TS 850P winter tyres and AllSeasonContact all-season tyres. But tyres are only one of a host of Continental products and technologies going into the new all-electric range. The company is also supplying computer equipment, brake technology, hose lines, heat pumps and driver assistance systems.
Bridgestone’s Blizzak LM005 tyre has won the Auto Express Winter Tyre Test 2020 beating 205/55 R16 tyres from seven other manufacturers to the top of the table. Auto Express cited the tyre’s performance in the wet as a key factor. The tyre, which boasts an ‘A’ tyre label grade for wet grip across the full range, has secured Bridgestone’s first Auto Express test win and follows on from a series of improved results in recent times. However, there were strong performances from Hankook’s Winter i*cept RS2 (2nd) and Michelin’s Alpin 6 (3rd). At the same time, we have to note that Hankook Goodyear and Dunlop each won individual categories as well as Bridgestone, of course. Looking forward, Continental’s TS 870 has to be described as the one that got away because it’s market-beating performance couldn’t be counted owing to the fact that the Covid-19 pandemic has delayed the new tyre’s release for a year.
Continental has once again released an overview of the European regulations regarding winter tyre equipment for trucks and buses. It also gives advice relating on who should be informed if you do breakdown.
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.
This article appears in full in the October edition of Tyres & Accessories magazine. Not yet a subscriber? You can change that here.
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.
Reclaimed Carbon Black (rCB) firm Pyrolyx, which signed a five-year supply deal with continental in November 2019, has withdrawn from both the Australian and German stock markets.
Continental is changing the name of its StraddleMaster+ port tyre line to TerminalMaster V.ply. This change of name is also accompanied by a significant expansion of the tyre’s application recommendations: Instead of primarily being intended for use on straddle carriers, Continental says “intensive tests in the laboratory and in real-life use” have led it to additionally recommend the tyre for use at airports and for heavy-duty transport in the industrial sector.
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.
Michelin and Pirelli are leading the way on tyre and rubber sustainability, according to a recent report from Context Group. Context’s ranking assessed 11 members of the Tire Industry Project (TIP), namely Bridgestone; Continental; Cooper; Goodyear; Hankook; Kumho; Michelin; Pirelli; Sumitomo Rubber; Toyo and Yokohama.
Context analysed the sustainability content on each company’s website to see if it included communications covering some of the main issues associated with the life cycle impacts of tyres, including the four focus areas of the TIP: tyre and road wear particles, sustainable natural rubber, end-of-life tyres and environmental performance. The researchers assessed how well the companies tell their sustainability story by looking at their use of multimedia, news articles and social media.
Six-Time Formula One World Champion Lewis Hamilton is creating his very own race team, which will make its competitive debut in the Extreme E electric off-road racing series early next year. Hamilton has named the team X44 – a nod to his F1 car number – and although he won’t drive in the new championship or be involved with X44 on a day-to-day basis, the British driver will draw upon his experience to help guide the creation of a dedicated and competitive team. Extreme E tyre supplier Continental welcomes this backing from motorsport royalty.
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Vitesco
NRZ, Arno Borchers
Bridgestone
Continental
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Continental AG
Context Group