BERLIN — German auto supplier Continental is considering the sale of the car division currently bundled within ContiTech, Manager Magazin reported on Monday, citing company sources.
The possible sale would be part of a wider reorganization of the company being planned by Supervisory Board Chairman Wolfgang Reitzle and the executive board around CEO Nikolai Setzer, the German business news publication added, citing the sources.
Continental has taken a series of steps in recent years to restructure and boost profitability as its market capitalization tumbled to 13 billion euros ($14.17 billion) from 50 billion in 2018.
The company said in February it was reorganizing ContiTech from six divisions into one in each of Europe, the Americas and Asia Pacific, while bundling its car activities into a separate unit geared towards electromobility.
According to Manager Magazin, that unit — specialized in belts and sealing systems with revenue of more than 2 billion euros ($2.2 billion) — is due to be separated from the business within two years. It could be sold, split up further or merged with another company, the publication reported.
The highly profitable tires business and non-automotive part of ContiTech would be retained as the future core, it said, quoting an unnamed top manager who warned of the threat of a workforce rift if the tires business continued financing the cars business.
Continental declined to comment on the report.
The company said in May that ContiTech would be realigned with the aim of enhancing its impact and efficiency, without providing further details.
Continental ranks No. 9 on the Automotive News list of the top 100 global suppliers with worldwide sales to automakers of $25.4 billion in 2022.