Conti to Pump 500 million euros into Emerging Market Tyre Production
Continental AG chief executive Elmar Degenhart has shared details of how the automotive supplier is planning to invest 500 million euros into its tyre business in an interview Germany's Frankfurter Allgemeine Sonntagszeitung newspaper. According to the report, Degenhart admitted that Continental should have invested more in its tyre division during the past five years.
As a result the firm reportedly plans to double tyre production capacity in Brazil and will increase production in China, where its first passenger-car tyre was produced last week, next year. Conti is reportedly discussing a joint venture in India, while it is said to be “examining the possibility of launching its own production in Russia.”
CEO suggests expansion plans for emerging markets
On the subject of the Schaeffler/Continental merger Degenhart stressed that tyre production is an integral part of the group and that the company would merge with its majority shareholder at the end of 2011 at the earliest.
Degenhart said a 15 per cent company sales increase this year would be a “conservative estimate.” In China Continental is expected to grow sales by up to 60 per cent. He also said Continental is confident of reaching an operating margin “closer to 8.5 than to 8 per cent.”