Continental eyes Lithuania for possible factory

31st March 2005, Comments 0 comments

31 March 2005, HANOVER - German tyre and automotive components concern Continental is expecting to expand further into lower-wage areas, with a new tyre factory being considered possibly in Lithuania, company chief executive Manfred Wennemer said on Thursday.

31 March 2005

HANOVER - German tyre and automotive components concern Continental is expecting to expand further into lower-wage areas, with a new tyre factory being considered possibly in Lithuania, company chief executive Manfred Wennemer said on Thursday.

In remarks on the company's 2005 business prospects, he said Continental expects to continue posting record-high figures despite the stagnation in the automotive market.

He said the company is planning EUR 860 million worth of investments for new technologies and to expand production sites in low-wage countries this year.

A new tyre factory was under consideration for a site in Europe within the next 24 months, Wennemer said, while specifically mentioning Lithuania as a possibility.

In 2004, Conti posted net profits of EUR 674 million, more than double the previous year's earnings. Revenues rose 9 percent to EUR 12.6 billion, while operating profits, at EUR 1.1 billion, were up 28 percent on 2003 figures.

The company is to pay shareholders a dividend of EUR 0.80, up more than 50 percent from last year's EUR 0.52 payout.

For 2005, the company is expecting to boost both its revenues and operating results. Chief financial officer Alan Hippe said revenues growth such as that shown last year would be a challenge "but not unachievable".

Wennemer commented on Chancellor Gerhard Schroeder's appeal a few days earlier to German firms to create more jobs in Germany.

"We are gladly ready to create jobs in Germany," he said. But Conti was "soberly" examining the framework conditions and had concluded that "we still have a long way to go in Germany".

The comment came after he had reported that production in low-wage countries grew further in 2004 and that in some individual corporate areas those sites accounted for more than 50 percent of output.

DPA

Subject: German news

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