“We had so far been able to withstand this development, but now reached a point where the overcapacity in Western Europe is between 13 and 15 million passenger-vehicle tires,” Degenhart said.
Continental will shut down the Aachen factory at the end of next year, affecting as many as 2,000 jobs.
Degenhart, 61, spoke after Continental’s supervisory board approved a more drastic reorganization of the almost 150-year-old manufacturer.
Measures taken starting last year to revive profits were rendered insufficient when the COVID-19 pandemic pummeled global car production and weighed on prospects for the industry.
Continental employs about 232,000 people worldwide, including 59,000 in Germany.
The supplier has been reluctant so far to provide an outlook for the full year, citing persistent market uncertainty. It doesn’t anticipate the global market returning to 2017 levels until the middle of the decade and has shelved plans to spin off its powertrain division Vitesco Technologies until markets improve.
Continental ranks No. 4 on the Automotive News list of top 100 global suppliers, with fiscal 2019 sales to automakers of $35.3 billion.