German auto parts giant Continental to slash 3,000 more jobs

German parts supplier Continental plans to cut a further 3,000 research and development jobs in its automotive division by the end of 2026, with more than half of the cuts to hit plants in Germany.

The company announced on Tuesday that its Nuremberg facility would be shuttered as part of the cuts, and other facilities in the German states of Hesse and Bavaria would also be hit hard.

Continental cited the downturn in Germany's automotive industry in announcing the additional job cuts.

A year ago, Continental had announced a round of cuts as part of cost-savings efforts. At that time, it said 7,150 jobs would be eliminated in its automotive division, with 5,400 of those cuts to hit administration and 1,750 in development.

Continental said on Tuesday that those previously announced reductions have now been 80% to 90% implemented. With the latest announcement, total job cuts at the company now total over 10,000.

There will also be 480 total job cuts at Continental's software subsidiary Elektrobit, 330 of them in Germany. An Elektrobit spokeswoman did not provide further details on the planned cuts locations.

Around 10% of Continental's 31,000 jobs in research and development worldwide are to be cut in the cost-savings programme.

A Continental spokesman said the company's aim remains to reduce expenditure on research and development to less than 10% of turnover by 2027.

The company said it intends to make the reduction as socially responsible as possible, with most made by not replacing employees who retire or quit.

Details of the reductions will now to be negotiated with employee and trade union representatives by Continental management, the company said.

A Continental spokesman said that the additional job cuts are required because the challenging market situation has meant that the company is set to fall short of financial targets despite the earlier cutbacks.

"Forward-looking technology offerings are of crucial importance to our company," Continental's top executive for the automotive division, Philipp von Hirschheydt, said in a press release.

Hirschheydt said the company will continue "investing substantially in research and development in the coming years" even as it looks to improve "competitive strength in the interests of our sustainable market success."

Worker representatives sharply criticized the move.

"We are deeply concerned that the deep cuts in automotive research and development will escalate into a comprehensive restructuring," Michael Iglhaut, head of Continental's General Works Council, said in a statement.

"Job cuts and cost reductions at any price" are not a sustainable strategy for the future, he said.

The "deliberate bleeding of the German locations" weakens the overall automotive division at the company, which Continental intends to make independent this year.

In December, Continental announced its intention to spin off its automotive supplier division, which has been struggling with financial losses for years, and float it on the stock market as a separate company.

Company shareholders still need to approve that plan at Continental's upcoming general meeting.

If investors approve the move, an initial public offering on the stock market for the division under a new name could take place by the end of the year.