Conti turns 150: Company looks to future

HANOVER, Germany — Continental A.G. has made the pursuit of quality in mobility a cornerstone of its business since it began a century-and-a-half ago.

While many will mark the milestone by looking back on the company's humble beginnings in 1871, Continental is looking to the future and evolving to meet the demands of the modern world.

By 2050, Continental said its tires will be manufactured from 100% sustainable materials, and the supply chain will be completely climate neutral.

"The history of Continental has been shaped by major successes and no less by major challenges. Both have made us what we are today — a leading international technology company," Continental said in a statement, adding an estimated 1 billion drivers rely on its technology.

"Making mobility safe, clean, smart, sustainable and affordable is our mission."

As the company celebrates 150 years of business — officially on Oct. 8 — there are plenty of historic innovations that moved its mission forward: From the first "grooved" tire in 1904 to using artificial intelligence to build tires optimized for today's growing electric-commercial vehicle market.

"Tires are our passion. Our technological excellence has ensured safety, reliability and sustainability for 150 years," Christian Kötz, head of the tires business area and member of the executive board of Continental, said.

"Many of today's technology standards in tires come from Continental. Time-and-time again, we push the boundaries of what is possible."

Starting in one factory in Hanover, the company now operates in 58 countries. Tire Business ranks Conti as the fourth largest tire company in the world with an estimated $9.9 billion in tire sales in 2020. Conti's tire sales made up about 23% of total corporate sales in 2020.

Finding the 'groove'

Incorporated in Hanover in 1871 as rubber manufacturer, Continental-Caoutchouc- & Gutta-Percha-Compagnie, the company produced soft rubber products (such as toy balls and mats), rubberized fabrics and solid tires for carriages and bicycles.

In 1882, the iconic "rampant horse" was trademarked as the company's logo.

Continental — the oldest independent tire manufacturer in the world — was the first German company in 1892 to produce pneumatic bicycle tires, which led to production of tires for cars.

In 1904, the company unveiled its "grooved" tire, the first car tire with tread.

Continental said consumers in the early 20th century started seeking comfort in addition to safety. In 1908, Conti engineers invented the detachable rim, which made wheel and tire mounting much easier.

The company built its first corporate headquarters in 1913. The building now houses the Hanover government's Office for Economic Development.

Conti is putting the finishing touches on a new headquarters in Hanover that it plans to open later this year.

The first phase of the new Continental Campus includes eight interconnected buildings for 1,250 employees, with eventual plans for expansion to 1,600 workstations, the company said.

The current corporate headquarters only can accommodate around 900 employees.

Conti also started making agriculture tires in 1928, introducing the T2, the first pneumatic agricultural tire in Europe. The first tire made of synthetic rubber was built by Conti in 1936.

World War II

During the Second World War, Continental served the Nazi war machine, producing a number of rubber products for Hitler's Third Reich.

Continental commissioned and published in 2020 a study of the company's role in the war, which found the company was a key supplier of armament products for the Nazi regime. The company also used forced labor to operate production.

Continental "tried in many instances to put entrepreneurial self-interest above the regime's interests, but with a mixture of overzealous obedience and internal pressures, soon adapted to the totalitarian Nazi system," the study found.

"This also included the removal of Jews from the corporate management and supervisory board, which, albeit reluctantly, nevertheless took place in accordance with the Nazi leadership's directives."

Continental calls those the "darkest years," and said it commissioned the study because it felt it needed to acknowledge its past to better shape the present and future of the company.

"The frank examination of our past is the starting point for stimulating a debate on corporate social responsibility and for integrating it internally into our corporate strategy," Elmar Degenhart, Conti CEO, said.

"Without understanding the past and without fully coming to terms with the Nazi era, a conscious and unbiased embarkment into a successful future and the next 150 years of Continental is not possible," he said.

Sustainability

Amid shortages in the WWII economy, Continental launched a research project into obtaining rubber from the Russian dandelion (Taraxacum koksaghyz), an easy-to-grow source that can thrive in a large part of the world and has a growth cycle of just a year. The idea was developed widely by many countries during the war and many companies since.

Though it faded after the war, the project was taken up again in 2011 to develop Taraxagum, that has since been used in the development of the Urban Taraxagum bicycle tire, among other products.

In 1943, Continental filed a patent application for a tubeless tire — an invention that significantly improved the rolling resistance of tires. Conti said the focus on reducing rolling resistance has been a technological principle ever since.

In the post-war years, the company grew substantially, boasting a workforce of 13,500 in 1950 and 26,800 in 1966. In 1960, it should be noted, Conti started to mass produce radial tires.

Continental said it made a greater commitment to sustainability in the 1970s, as the oil crisis provided the impetus to focus tire development in optimizing rolling resistance.

"The insights gained in this project ultimately led to the presentation of a previously unprecedented product in 1993," the company said. "For the first time, a tire — the ContiEcoContact — combined environmental benefits and economic aspects with outstanding driving and safety characteristics."

Conti has continued research into reducing emissions and dealing with the challenge of using a finite raw material, like rubber.

The company's efforts are centered on four strategic topics: climate action; low-emission mobility; the circular economy; and sustainable supply chains.

The company noted that as early as 1903 it set up a plant for reprocessing and recycling scrap rubber.

In 2013, Conti opened the ContiLifeCycle plant in Hanover with an integrated approach to retreading for truck and bus tires and a specially developed industrial-scale rubber recycling plant.

The company said it is "systematically" investing in the research and development of new technologies, alternative materials and environmentally compatible production processes.

"Our goal is to produce our entire product portfolio exclusively from sustainable materials in a climate-neutral way by 2050 at the latest," Mr. Kötz said.

Digitization

In 1999, Conti demonstrated that using tires as the data source for advanced driver assistance systems made for quicker, more accurate data. For the company, that was the birth of the intelligent tire.

Today, Continental technology connects its tires and sensors to the cloud, offering customers a more seamless digital solution to addressing vehicle needs. Since 2010, for example, Continental has bundled all services for fleet customers under its Conti360° Fleet Services brand.

For fleets, Conti360° enables a number of things like tire selection assistance, quick access to correct mounting and assistance in the event of a flat tire. It also allows for constant inspection and comprehensive tire reports for all fleet vehicles.

With the digitization of the industry, it has enabled Conti to focus on more intensive testing of its products, too.

New tire models see more than 15.5 million test miles each year before the start of mass production.

The company maintains several state-of-the-art tire testing facilities around the world. The first test site, and the company's "prototype" for all the others, is the Contidrom in Hanover that opened in 1967.

As early as 1968, the company used the track to test an electronically controlled driverless car. Conti further developed the driverless technology and uses it today for tire endurance tests at its test facility in Uvalde, Texas.

In 2012 the Automated Indoor Braking Analyser (AIBA) opened at the Contidrom.

The AIBA enables brake performance testing of tires on different road services using AI-assisted unmanned vehicles.

Looking ahead, Conti said tires will also be tested in a new type of dynamic driving simulator, which allows test drivers to simulate real test scenarios virtually.

AI and virtual testing also creates less waste, which the company said is a part of its long-term sustainability goals.

Continental said it will continue to expand its ecosystem of digital solutions.

As one of the largest suppliers of electronics, sensor systems and software in the mobility industry, the company said it has a decisive competitive advantage.

For example, in the early 2000s, Continental used its data sourcing technology to allow the tire to communicate with other safety-related components in the vehicle to improve braking. The result? Up to 25% shorter braking distance on average.

Today, Continental data technology is cloud-operated, fed by a large number of data points. Fleet customers can check real-time tire data, which offers a better chance of case-by-case maintenance rather than overall preventive measures across the fleet.

The company said this decreases downtime and creates a more efficient process, which ultimately lowers overall costs.

"In the future, Continental will continue to stand for innovative excellence in tire technology with its premium portfolio in the passenger car, truck and special tire segments," the company said.

In 2020, Continental announced its Vision 2030 strategy program, which it calls a "customer-centric orientation of the organization and all business activities."