Hanover, Germany – Continental AG is currently assessing cost-cutting measures in response to the growing market deterioration in the wake of Covid-19 pandemic, the company has told ERJ.
“The extent of further potential measures will be aligned with the medium-term market development,” said Silke Bernhardt, head of communications of Conti business area tires, without giving further details.
The comments came in response to a recent report by German weekly WirtschaftsWoche which cited Conti CEO Elmar Degenhart suggesting possible forced layoffs in an internal video.
“The subject of current reporting (Wirtschaftswoche) are statements made in the context of an internal event of Continental AG... We generally do not comment on this,” said Bernhardt in a written statement to ERJ.
Continental disclosed that it was taking a series of new cost-cutting measures in March in addition to its 10-year structural programme which was announced in September last year.
The programme focuses on the medium- and long-term competitiveness of the German group driven by transformation within the automotive industry.
“As soon as the current highly volatile market environment has stabilised and we can better predict how it will develop... [the company] will consider and decide any additional measures that may become necessary,” Bernhardt added.
Continental reported weak first quarter results in May, posting a 21% decline in earnings to €1.1 billion, on 11% lower sales at €9.8 billion.
The German supplier has said that it expects the second quarter to be “the weakest” this year, with the impact of coronavirus likely to be particularly severe in Europe and North America.