Since the outbreak of the coronavirus, our main focus has been on the health of our employees and, in addition, on maintaining our supply chains.
We are supporting affected sites, for example by providing our employees with personal protective equipment, if available.
The economic environment has again deteriorated substantially since the beginning of March as a result of the coronavirus pandemic, which has meant that we have intensified cost-cutting even further. We are scrutinizing the necessity of all expenditures and investments at present and looking for savings that will have an immediate effect. We are continuing to push ahead at full steam with key development projects as well as preparations for upcoming production start-ups.
As a result of the coronavirus pandemic, Continental temporarily ceased activities starting mid-March at more than 40 percent of Continental’s 249 production locations worldwide for a few days to several weeks in order to protect employees and in response to the drop in demand. It resumed production at many locations early in May.
Since the beginning of June, production has been resumed at all plants worldwide. Due to potentially lower customer call-offs, it is possible that the production is certain plants must be stopped temporarily once again.
Please be understanding of the fact that we cannot provide any figures regarding costs and knock-on effects at this point in time. These are not foreseeable.
Due to the temporary production stops and lower demand, about 30,000 employees in all company functions worked eight days less on average in May as part of the short-time work scheme in Germany. Due to the coronavirus pandemic and the ongoing uncertain economic environment, Continental will continue to make use of short-time work here in June. The extent to which short-time work is utilized depends on local conditions.
As a sign of solidarity with Continental employees who have been affected by the coronavirus pandemic around the world, the Executive Board already decided on a salary waiver for its members in March 2020. For Executive Board members, this means that their fixed salary has been reduced by 10 percent in the four months from April to July, in addition to their variable remuneration, which will undoubtedly be much lower.