Automotive supplier Continental may sell off the automotive division business portion of its industrial parts unit ContiTech, according to a report from German business magazine Manager Magazin, citing company sources.
Continental Supervisory Board Chair Wolfgang Reitzle and the executive board floated the potential sale as part of a corporate restructuring, according Reuters, citing Manager Magazin. If approved, ContiTech would be spun off from Continental within two years. The automotive portion of the unit could be sold, further divided or merged with another company.
ContiTech manufactures industrial and automotive rubber, plastic, metal and fabric components. Its automotive product line includes drive belts, pulleys, belt tensioners and hoses. The company operates core branches in Asia, Europe and North and South America and reported sales of about $7.2 billion (6.6 billion euros) in 2022.
In February, according to Reuters, Continental said it was restructuring its six-division ContiTech unit into single divisions in the Americas, Europe and the Asia Pacific region to boost profitability. The company’s automotive business would be a separate unit focused on components for electric vehicles. Continental supplies battery sensors, current sensing modules, braking systems, tires and other EV components.
Earlier this month, Continental reported consolidated sales of $11.4 billion in Q2, a 10.4% jump compared to the same period last year. The increase was largely the result of strong tire sales and high order intake in automotive parts of roughly $9.4 billion. Continental’s automotive group sales increased by 19% to $5.6 billion in Q2.
According to Reuters, Continental’s tire business, as well as the non-automotive segments of ContiTech, would be retained as ContiTech’s core business.
