Continental to Close Two European Plants

Company will also reduce production by 20%

German auto parts group Continental said on March 11 it will close two European tire factories, including one in France that employs 1,100 workers.

"We have studied various options and concluded that the competitiveness of the tire divisions can be maintained only by closing the two plants with the highest costs," division head Hans-Joachim Nikolin said. They are a passenger car tire plant in Clairoix, northern France, and a commercial vehicle tire factory in Hanover, northern Germany.

In Hanover, around 780 workers would be affected by the plant closure, the company said, while in Puchov, Slovakia, Continental also planned to reduce production by 20%.

The statement said a "steadfastly dire market trend" had resulted in production overcapacity and the market will not recover enough in the short- to medium-term to justify continued operations at the two sites." In the last three months of 2008, the commercial vehicle tire business plunged 20% in Europe, Continental said. "This trend has accelerated dramatically in the first two months of the current year," it added.

"It has not been easy for us to present these plans to those concerned. Regrettably, there is no alternative," Nikolin said.

Copyright Agence France-Presse, 2009

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