Continental To Cut Thousands Of Jobs; Sees EUR 400 Mln Cost Savings

(RTTNews) - German autoparts maker Continental AG Monday announced its plans to cut thousands of jobs in its automotive unit as part of its efforts to strengthen the sector's competitiveness.

Continental said its Automotive sector is simplifying and streamlining business and administrative structures.

With the planned measures in the administrative structures, Continental is aiming to ease the sector's costs by 400 million euros annually. The company expects the full extend of the planned cost savings from various measures to be reached by 2025.

The company is yet to decide the exact number of globally affected jobs, but is expected to be in the mid four-digit range at Automotive. A broad range of measures are being developed across all parts and all levels of the organization.

Under the plan, the sector's organizational structure will be consolidated into five business areas instead of the previous six. The Commercial Vehicle, Automotive Aftermarket, and Actuator business will be reallocated within Automotive. The business area Smart Mobility will be dissolved.

The remaining business areas would be Architecture and Networking, Autonomous Mobility, Safety and Motion, Software and Central Technologies and User Experience.

The Automotive sector is also currently examining additional measures to increase efficiency in the R&D area.

Philipp von Hirschheydt, Member of the Executive Board and Head of Automotive, said, "Our goal is to create a sustainably profitable sector that can invest in its future from its own resources.... These initial measures are important for improving the competitiveness of the Automotive sector. ...To significantly improve efficiency and effectiveness, we are looking at all functions and processes without reservations, from sales to research and from development to production. We are also entering discussions with the social partners to identify suitable measures."

The company plans to provide a comprehensive strategy update for the sector at its Capital Markets Day on December 4, 2023.

In Germany, Continental shares were trading at 63.94 euros, up 0.88 percent.