On August 21, Germany's "Manager Magazin" reported, citing sources, that German automotive parts supplier Continental AG is contemplating selling the automotive business under its ContiTech division. The potential sale is believed to be a part of a broader company restructuring plan by Continental AG.
In recent years, with Continental AG's market value plummeting from €50 billion in 2018 to €13 billion, the company has undertaken several measures for restructuring and enhancing profitability. In February of this year, Continental AG strategically realigned the ContiTech subgroup with the intent to expand its industrial business while integrating its automotive operations to create synergies. The industrial operations will focus on regional demands, divided into three business units: Industrial Solutions Americas, Industrial Solutions Asia-Pacific, and Industrial Solutions Europe, Middle East, and Africa. Meanwhile, the majority of ContiTech's automotive operations will be consolidated into the Original Equipment Solutions business unit.
Recent reports suggest that ContiTech's division specializing in seat belts and sealing systems, with an annual revenue surpassing €2 billion, will be spun off within two years and subsequently either sold, further split, or merged with another company.
Furthermore, Continental AG's highly profitable tire business and non-automotive operations are expected to be retained as its core businesses for the future. The report cited an anonymous senior executive saying that there might be disagreements among employees if the tire business continues to finance the automotive operations.
Continental AG has not commented on these reports. However, in May of this year, the company did mention a restructuring of ContiTech to enhance its influence and efficiency, without providing further details.
In the "Automotive News" 2023 top 100 global automotive suppliers ranking, Continental AG ranked 9th, with sales to global auto manufacturers amounting to $25.4 billion in 2022.
