- Business activities at Gifhorn plant to be phased out by 2027
- At least half of jobs at site to be affected
- Shares up 21.86% year-to-date after 2022 slump
Hanover-based Continental AG on Friday announced plans to phase out business activities at its Gifhorn facility by the end of 2027.
At least 450 out of 900 jobs at the facility are to be affected, the company said.
The planned moves include relocation of the assembly of latest-generation air supply systems in 2024, relocation of the spare parts business from 2024 as well as outsourcing of valve block and piston head production to suppliers by 2027.
The decision was made “against the backdrop of the sharp increase in cost pressure in the automotive industry, the declining automotive markets, and the high and by international standards uncompetitive cost structure at the site,” Continental said in a statement.
Workers affected by the measures will either be moved to other parts of the company or will receive assistance in finding work on the external labor market, Continental said.
The shares of Continental AG (CONG) were last gaining 1.49% (EUR 1.00) on Friday to trade at EUR 68.22 on Xetra, while reversing a loss from the previous market session.
The technology company’s total market cap now stands at EUR 13.965 billion.
The shares of Continental AG went down 39.88% in 2022, compared with a 12.35% loss for the benchmark index, DAX (GDAXI).
The company’s shares have risen 21.86% so far this year.