Continental realigning ContiTech group sector for growth, efficiency

HANOVER, Germany—Continental A.G.'s ContiTech group sector is getting a bit of a makeover.

The strategic realignment—which is designed to focus the industrial side of the group on three geographic regions—is intended to strengthen the effectiveness and efficiency of these material-driven solutions businesses, allowing for growth on the industrial side.

To this end, the industrial business will be organized around the profiles and growing demands of the regions served. The established divisions will be: Industrial Solutions Americas, Industrial Solutions APAC (Asia and Pacific) and Industrial Solutions EMEA (Europe and the Middle East).

"We are enhancing our profile and are becoming more efficient by consolidating our activities," Philip Nelles, member of the Continental Executive Board and CEO of the ContiTech group sector, said in a statement about the realignment. "This will increase our competitiveness and create a strong foundation for our future success in terms of earnings and growth."

Ideally, Continental said, the move will give it the ability to respond quickly and nimbly to changes within the market, allowing the company to transition from a traditional product supplier into an "integrated solutions company."

Continental also hopes the changes give it better proximity to customers and markets served—namely off-the-road, on rails, in the air, under and above ground, as well as industrial environments, in the food sector and in the furniture industry.

As the industrial business narrows its focus to better serve industrial markets across specific geographic regions, ContiTech's automotive activities are taking a broader, more global approach. The automotive activities are slated to be consolidated into the Original Equipment Solutions business area, which will operate globally in accordance with its customer structure.

With the challenges of the rapidly transitioning automotive industry ahead of it, Continental is hoping that the consolidation of its automotive activities will allow it to increase speed and efficiency by streamlining decision-making processing and central functions.

Continental said the Surface Solutions business area "will retain its current structure due to the nature of its own portfolio and customer base and its high degree of product development connectivity between its segments."

It also noted that its Automotive Interior segment will serve suppliers to the automotive industry, and that LivTec will focus on private consumers.

To help drive these expansion efforts for materials expertise within the group sector, Continental will add a chief technology officer position. This will allow for "comprehensive and cross-functional research activities as well as the development of material-driven, value-creating and sustainable solutions for customers."

The company's ambition around the realignment, Nelles said, is clear: "In our industries and markets, we want to be a technological leader for material-driven solutions."

The realignment of the ContiTech business will be effective at the beginning of May.