Continental's Chinese tyre plans not yet finalised

By Liz White, ERJ staff

Hanover, Germany-Continental AG opened a new Asian headquarters for all of its divisions, in Shanghai, China, 23 Jan and said the operation will represent Continental Automotive Systems, Continental Tires and ContiTech.

Conti, which is also planning a new tyre plant in China, will invest about Euro 300 million in total in such a venture, a Conti spokesman confirmed. He also said the German tyre maker is now leaning rather more towards a greenfield Conti tyre plant, as opposed to setting a joint venture with a local partner. But, he added, no final decision has yet been taken.

Conti has struggled to find a route into the Chinese tyre manufacturing sector, with one failed JV proposal behind it. In mid-2005, the group broke off talks with potential partner Qingdao Doublestar Tire Industrial Co. Ltd, over difficulties with ownership of the company.

Meanwhile, at Continental's Hanover, Germany headquarters, management is in discussions today (24 Jan) with workers' representatives about plans to stop making passenger car tyres at its Stöcken, Hanover site, with 320 redundancies.

These plans have angered the unions, who last year agreed a package of measures designed to help the tyre maker cut costs at its operations, in return for a guarantee of no job losses.