On September 3, Continental confirmed it will gradually shut down its solid industrial tire production line at the Korbach plant in Germany, shifting related capacity to the Asia-Pacific region. This move aims to optimize its global business layout and strengthen the long-term competitiveness of its tire operations. Under the plan, the Kalutara facility in Sri Lanka and the Petaling Jaya plant in Malaysia will take over this production volume.

The capacity transfer begins this year, with full completion expected by mid-2029, affecting approximately 140 employees. Continental stated that the decision stems from years of insufficient capacity utilization in the industrial tire segment, compounded by significant cost pressures. The lengthy transition period is designed to ensure stable customer supply and provide employees with ample time for adaptation. The company will implement transition programs, including qualification certifications and continuing education, to avoid operational layoffs wherever possible.

Importantly, the Korbach plant will not be completely shut down. The facility, which employs around 2,400 workers in the tire segment, will continue producing passenger car, light commercial vehicle, motorcycle, and bicycle tires. Over the past decade, Continental has invested more than EUR 300 million in the plant, and since 2016, it has also manufactured ultra-high-performance tires of 18 inches and larger at a local technology center. Additionally, the group is constructing its first proprietary wind farm nearby to supply electricity to the plant in the future.

Solid tire production at Korbach dates back to 1965, and its complex vulcanization process and high energy consumption have made it a target for this adjustment. However, the works council has sharply criticized the decision. Council Chair Jörg Schönfelder pointed out that Continental, having previously sold its ContiTech division for around EUR 4 billion and planned to distribute approximately EUR 2.5 billion to shareholders, has placed even greater pressure on the profitability of its pure tire business. He further noted insufficient investment in product development and customer service in this segment in recent years, adding that the company's empty promise to "avoid layoffs" is far from adequate. The union will push for an explicit exclusion of operational redundancies during negotiations.

Amid persistently high manufacturing costs in Europe, this eastward shift of production capacity once again highlights the practical challenge multinational corporations face in balancing shareholder returns with employee interests.