GISLAVED, Sweden (Dec. 11, 2001)—The Swedish subsidiary of Continental A.G. is negotiating with local trade unions about closing the passenger tire plant in Gislaved by July 2002. The closing would affect 774 jobs, according to a statement from Conti.
This move follows Continental's decision to take a critical look at all corporate production plants. Conti intends this ongoing restructuring to improve the profitability and efficiency of its global operations.
Conti blamed weaker demand for passenger tires and a drop in passenger car output for the restructuring. The tire maker estimates an overcapacity of 5 million tires in 2002 in view of the downturn in the market and keener competition.
Gislaved, with an annual capacity of 4 million tires, is the smallest Conti unit. One of Conti's stated goals is to focus on production plants with output of at least 8 million tires per year, a strategy which puts the Gislaved location in jeopardy.
The warehouse at Gislaved with studding, wheel mounting and research and development activities, could continue in some form, the German tire maker said. The decision will not impact the Gislaved brand nor the sales company in Gothenburg, Sweden, Conti added.