Continental says it will phase out its suspension and vibration control product manufacturing in Mitchell, Ont., and transfer the business to another manufacturing location in North America.
The move will put 151 people out of work by March 2021. The plant handled product lines that included spring strut mounts, bushings, vibrations absorbers and dampers, crossmembers, and exhaust hangers, all under the ContiTech brand name.
The announcement is part of the company’s plan to enhance competitiveness and protect the viability of its operations across North America.
According to a statement by Continental, demand for suspension and vibration control products from the company’s Canadian plant in Mitchell, Ont., has reduced significantly.
“In 2019, our sales volume has declined significantly when compared to 2018 and we expect the downward trend to be continued in 2020 and beyond,” the company said. “Over the past months we have done all we could to offset the business loss in our Mitchell facility, however we were not successful.”
With the Mitchell plant no longer competitive and the majority of the company’s plants being under-utilized, the decision was made to phase out manufacturing in Mitchell by the end of the first quarter 2021.
“We will continue to operate the onsite R&D centre and transfer it step-by-step to another location in North America by the end of 2021,” the company said. “This decision was not easy and not taken lightly; unfortunately it was necessary.
The company said it will seek the best solution for each employee affected. In the coming months, Continental will discuss individual opportunities. Continental will actively support those interested in applying for a transfer to other locations or will provide severance packages as required.
ContiTech plant in Auburn, Indiana.
Meanwhile, the company has announced plans to expand its research and development operations in northeast Indiana, advancing innovative technologies to reduce noise vibrations for the automotive and commercial sectors.
The plan will create more than 45 new jobs by the end of 2023.
Continental plans to invest more than $4 million to grow its ContiTech Vibration Control business unit, renovating and equipping a 100,000-square-foot building to accommodate the consolidation of existing technical centers in Canada and Michigan, while supporting the company’s efforts to increase efficiencies in its anti-vibration systems. Continental plans to be fully moved into the facility by the end of 2024.
Continental operates more than 80 locations and employs approximately 46,000 workers across North America, including roughly 470 across its multiple Indiana locations. To support its northeast Indiana growth, the company will begin hiring for positions in testing, prototype, design and product development.
“We are excited and grateful about this opportunity to grow in the region,” said Scott Bykowski, head of research and development for vibration control technology and noise insulation for Continental North America. “Thank you to the Continental management team as well as state and local governments in Indiana for their strong partnership and support throughout this process.”
Continental specializes in vibration control technology and noise isolation for the automotive industry, developing products and systems to optimize in-car vibration and noise levels as well as sealing systems for applications in chassis, brakes and steering. In 2019, the technology company acquired its Auburn location from another major automotive manufacturer. The facility has a long history in the community dating to 1896 when it was operated by Auburn Rubber Corp. Continental operates production sites as well as development and application engineering centers for its vibration control technology and noise insulation solutions in Brazil, China, France, Germany, India, Mexico, Slovakia and the U.S.