How Conti was 150 years old – economy

When you talk to the people at Conti in Lower Saxony about the past and future of the company these days, they like to talk about the horse. Which may come as a surprise at first, given that Continental is one of the largest automotive suppliers in the world. But on the other hand: the horse, or rather the equipment for horse and rider, is the clearest constant in this company, which is 150 years old this Friday.

In any case, Ariane Reinhart, the Board Member for Human Resources and Sustainability, holds out a rubber piece when she talks about the anniversary: ​​a hoof buffer. The “Continental Caoutchouc- und Gutta-Percha-Compagnie” started its business with this product in 1871: For decades, horses have been equipped with it to dampen the hoof clatter in cities and relieve the animals’ shackles. A good deal that the company from Hanover remembered some time ago: there is now the “Continental Turfcord”, a rubber hoof protection that replaces the traditional horseshoe. “Some things stay the same,” says the manager, who also rides herself. Whereby it was largely with the traditional.

Because Conti has changed again and again. It is a company that reflects German history in its ups and downs, as the historians Paul Erker and Nils Fehlhaber critically note in the anniversary publication. Continental is a success story, they write. “One that is based on the constant restructuring and reinvention of the organization.” Although Conti has never been lucky: all anniversaries took place in times of crisis or at least phases of upheaval.

The company benefited from the Nazi regime

In 1896, for example, the consequences of the “Great Depression” that followed the start-up boom in which Continental was born could still be felt. But they got up, built air covers for zeppelins and became the original equipment manufacturer for the largest car manufacturer at the time, Opel. Above all, however, Conti was known back then as a manufacturer of rubber balls and rubber dolls.

Then the two world wars, one of which fell victim to the foreign branches of the already global company. In the other, management benefited from the support of the Nazi regime. At least 6,700 forced laborers, prisoners of war and concentration camp inmates toiled around the end of 1943 to produce artificial rubber, buna, for war equipment.

So entangled in injustice, the historians write, the company management and workforce had to completely reinvent themselves. It succeeded with the product for which Conti is known to most today: tires. But in the 1960s the competition became a threat to its existence: Michelin from France had developed a completely new, technically superior tire technology – which weakened the Germans so much that a few years later competitor Pirelli was able to start a takeover attempt that only narrowly failed.

It was not until the mid-1990s that the electronics division began to be built up through acquisitions, which today accounts for half of sales (planned for 2021: 34 billion euros and 6.5 percent operating margin). The high point: The billion-dollar purchase of Siemens VDO, which produces ABS sensors, for example. Excessive self-confidence instead of worries about the future dominated now. A good ten years ago, the Franconian Schaeffler AG liked this so much that it was preparing to become the largest single shareholder at Conti. An undertaking that initially caused violent arguments and financial difficulties, but did not harm Conti: Sales and the number of employees doubled during the time under the leadership of Elmar Degenhart.

Turn away from the combustion engine, invest in the digital

In retrospect, historians come to more than half a dozen “more or less pronounced and partly overlapping transformation phases” that the company has survived – because of its internal robustness and a constant striving for independence. The next transformation is currently underway, perhaps the biggest so far: The stagnating car sales in the world and the end of the combustion engine have affected Conti. Plants will be closed, and a total of 23,000 of the 193,000 employees will “change” by the end of the decade. Conti wants to retrain them, but not all of them will be able to keep their jobs.

“Are we driven, are we drivers? To be honest, we are both,” says Conti board member Reinhart. And so they have just given away all of the drive technology – internal combustion and electric motors – to a spin-off called Vitesco and are focusing entirely on digital: The computers in the Volkswagen models ID.3 and ID.4 come from the Lower Saxony group, for example. “The following sentence applies: when you let go, you have your hands free for new things,” says Reinhart. Whereby at least they always remember the origin: A horse is still shown in the Continental logo, even after 150 years.