DüsseldorfBei Continental the house blessing is wrong. After a few days ago, CEO Elmar Degenhart had not ruled out the task of individual locations, it’s rumbling inside the workforce. Immediately there was concern that the board could cash in a key issues paper from the spring, the German ContiEmployees guarantee employment security.
“The members of the Group Works Council were just as irritated by it as many colleagues at the sites,” it says in a letter from the employee representatives to the employees last Friday, which is the Handelsblatt.
Such statements led to “great uncertainty and worries in the workforce”, especially in times of the forthcoming Group restructuring of Continental AG. Conti wants to give itself a holding structure with three divisions in the coming year, dThe “Powertrain” division (drive technology) is even supposed to be partially floated on the stock market,
The Group Works Council was forced to act immediately. “We have asked for clarification,” said the works council chairman Hasan Allak on request. At least for the time being, the waves would have smoothed out again somewhat: “At job security in Germany nothing changes. “This commitment was made by the board to the works council.
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The letter from the works council to the employees also states that the statements made by CEO Degenhart “relate to Continental AG in a global context”. In addition, no site closures are currently planned in Germany.
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The employee representation of Conti wants to ensure that no one in the company is disadvantaged in the upcoming corporate restructuring. “The Group Works Council is confident that site closure and downsizing in the context of the challenges in the automotive industry can not be an answer,” says the employee letter. The company must present an “effective qualification concept”, which prepares the employees sufficiently for the upcoming transformation process.
However, the Group Works Council has only a decisive influence on the German Conti employees. Job security for the forthcoming release of the “Powertrain” area only applies to the locations in Germany.
At the other locations around the globe, the employee side has no comparable say. Continental does not even have a global works council, but only one at European level.
After ten years of uninterrupted growth, the current unrest is something completely new for the supplier group from Hanover. The company had experienced problems in the operational business in recent months, Markant was the end of August, the second profit warning within a few weeks.
Instead of the previously announced operating return of ten percent, Conti management now expects only nine percent this year. Triggers were order cancellations from Europe and China. There are also major internal problems in the “powertrain” area.
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Conti management has put this double profit warning under massive investor pressure. CEO Degenhart must prove to investors that he has his company under control. The loss of confidence among investors is reflected in the crash of the Conti stock market price. At the end of June, the paper was still trading at just over 200 euros. After the profit warning at the end of August, the stock fell below 150 euros, in October, the Conti share then lost another ten euros.
Particularly painful are the problems for the Conti management in the “Powertrain” area, as the return also declines. For a successful IPO in the coming year, Continental must present a promising business model. The withdrawal of the promise of return is the exact opposite. This puts additional pressure on management.
At the beginning of September, the board itself had already written a letter to its own management. “On this wrong track we do not drive a meter further. This train stops right here and now, “it said in the ironic letter of the Conti leadership.
There will be personnel changes in management “where the relationship of trust with our relevant stakeholders is sustainably damaged”. With this letter, CEO Degenhart did not meet with approval throughout the company and on the Supervisory Board. Nevertheless, he had received a new five-year contract at the end of September.