Auto Crisis Could Last up to Five Years Says Auto Parts Group Boss

Continental will close plants in France and Germany

The head of German auto parts group Continental warned on April 23 that a crisis in the automobile sector could last up to five years and reaffirmed his intention to close two European plants. "It will in fact probably take five years before demand is back to its pre-crisis level in 2007," Karl-Thomas Neumann told a general assembly of the group's shareholders.

As a result, "we do not have any alternative" to closing sites in Claroix, northern France and Stoecken, northern Germany, the Continental boss said. "Given the slump in our markets, there is nothing else we can do" but to eliminate jobs."

"Our company is too big. We have to adapt capacity to the real demand in coming years," Neumann said.

Around 3,000 workers from the two factories had come to Continental's headquarters to protest against the closures.

Continental slashed around 8,000 posts worldwide last year, and 6,000 more in the first three months of 2009. It now wants to cut capacity further and plans to increase the number of workers already on part time hours by 25,000 on top of the 20,000 already affected.

Continental said in March that it would close the two European sites, which employ around 1,900 people, because of the auto sector crisis.

German competitor Bosch, the world's leading auto parts maker with the exception of tires, said on April 23 that 2009 would one of the hardest years in its history.

Copyright Agence France-Presse, 2009

TAGS: Talent
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