ContiTech eyes cuts, relocation to lower-cost countries to restore competitiveness

Hanover, Germany – ContiTech AG is planning further restructuring measures, including job cuts and the relocation of some activities to lower-cost countries, as it seeks to restore competitiveness in what it described as a “changing market environment.”

In a 24 Nov statement, Continental’s materials and industrial arm said the new programme will be implemented in addition to earlier announced measures, which it now says are “no longer sufficient.” (ERJ report) 

The company’s key markets and regions "continue to underperform" while cost structure remains too high compared with competition, the German manufacturer added.

ContiTech aims to achieve around €150 million in annual savings from 2028, with restructuring set to begin in 2026.

The plan includes relocating selected functions, reducing headcount and adjusting internal processes across “all parts and levels” of the organisation.

The company said the exact number of jobs to be cut in Germany and the approach to implementation will be determined in cooperation with social partners.

The move will mainly affect operations based in Hanover, with plans to relocate some activities to countries “with more competitive cost structures.”

ContiTech said the measures will be carried out “as responsibly as possible.”

“Cost pressure is increasing due to a changing market environment, slower growth rates in key economies and industries, ongoing uncertainty from trade conflicts and intensifying competition – particularly from China,” said Philip Nelles, head of the ContiTech.

Adjusting the cost structure, Nelles explained, “is necessary regardless of the planned sale of ContiTech and its future ownership.”

According to the ContiTech boss, a competitive cost level will be essential for the company’s long-term viability and in order to unlock medium- and long-term potential.

Nelles added that ContiTech’s Industrial Solutions Americas business area began implementing measures to strengthen competitiveness in the region in October and November. (ERJ report)