New blow to Germany's automotive industry as Continental mulls plant closure

In a fresh blow to Germany's beleaguered automotive industry, tyre and components manufacturer Continental AG has announced it is considering closing its plant in Aachen by the end of next year.

The news comes not longer after the company announced plant closures, changes and layoffs in other locations across the country including Roding, Karben, Mühlhausen and Babenhausen. Plants in Italy and the US are also being looked at for "restructuring" by the automotive supplier.

Blaming the slump in sales due to the coronavirus as well as "structural changes" within the automotive industry, the closure of the Aachen plant, which has not been officially decided yet, would mean the loss of 1,800 jobs in the area.

Criticising Continental's plans, Francesco Grioli, a member of the executive board of the trade union IG BCE, which is one of Germany's largest and represents workers in a range of sectors, said: “These [cuts] cannot be justified by changes in the auto industry, nor by the Corona crisis. It is simply removing the plant for the sake of it.”

“[These plans] will meet our resistance at all levels,” Grioli added. "What we need in the current situation are intelligent instruments to implement changes in a socially acceptable manner and to keep as many skilled workers as possible on board."

This year, Continental has recorded the sharpest drop in sales in its electronics, sensor technology and brake systems businesses, however, its tyre division was still considered to be comparatively profitable, despite also suffering a clear decline.

Earlier this month, the company announced that it would be tightening its ongoing austerity drive and corporate restructuring.

Continental has estimated that 30,000 of its more than 232,000 employees will be affected, with 13,000 being in Germany.

Christiane Benner, Vice Chairwoman of IG Metall and Deputy Chairwoman of the Supervisory Board of Continental, added: “Announcing further job cuts is a short-sighted answer to economic problems... Continental's management must come up with a future-oriented business strategy. We will not allow a traditional company to be ruined."

The group works council, together with IG BCE and IG Metall, started a public petition entitled “Time for Perspectives at Continental”, which calls for support from people in Aachen and the local region. 

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