Continental AG has temporarily shut down more than 40% of its 249 production facilities around the world, and first quarter preliminary sales are down at least 10% compared to a year ago.
Continental competes in several sectors of business both inside and outside of automotive, and tires and rubber are just one component of the business. The company hasn't detailed which plants have closed or for how long, but has previously stated that it was "gradually adapting" tire production worldwide, including in North America.
On April 1 the company announced it was canceling its plans to release its 2020 outlook due to the market's uncertainty amid the COVID-19 crisis. As part of that, it revealed a few more details of the business' current state.
"The cutback in production affects in particular Continental’s locations in Europe as well as in North and South America. In China, the company halted production at its plants after the outbreak of the coronavirus in compliance with local regulations. Continental has gradually resumed production there starting February 10, 2020."
Continental continues to produce products that are "vital for industries crucial to people's needs," including medical technology and hoses.
The company also released preliminary results for the first quarter. Consolidated sales are around 9.4 to 9.8 billion euro. At a minimum, globlal sales are down 1.6 billion euro compared to 2019 first quarter sales of 11.0 billion euro. That's at least a 10% drop.
“In periods of crisis, financial liquidity is of top priority," said CEO Dr. Elmar Degenhart. "To this end, we are cutting our costs, optimizing our working capital and postponing projects and investments that are not urgently required until further notice. We are, however, continuing to push ahead at full steam with key development projects as well as preparations for upcoming production start-ups. In this way, we are maintaining our ability to function effectively and confidently."
Previously, Continental had anticipated consolidated sales for the current year of around 42.5 to 44.5 billion euro.