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Work Group Agrees on Redundancy Package for 1,120 Employees at Continental Plant in Clairoix

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HANOVER/PARIS – June 6, 2009: In the negotiations between the French and German Continental management and the French trade union representatives, as well as Philippe Gustin, participating on behalf of the French government, a fundamental agreement was reached today in Paris. “We are pleased that we have already come up with a solution before the end of the four-week negotiation phase,” said Dr. Thomas Winkelmann, who represents the German Continental management in his role as HR manager in charge of the passenger tire replacement business in Europe and Africa. “We have thus faced up to our social responsibility for the 1,120 employees affected by the planned closure of the plant in Clairoix. Now all that is needed is the approval of the French central works council, which will most likely be obtained shortly. We will then be able to explain to each individual employee the exact provisions of the redundancy plan and the next steps that are to be taken,” commented Winkelmann.

The French union representatives had impeded the entire negotiations by rigidly focusing on negotiating the highest possible uniform one-off severance payment for all employees affected. “The one-off payment of €50,000 for each employee is now a component of the overall solution – not more, but also not less, explained Winkelmann.

“Our thanks also go to Philippe Gustin, who contributed substantially to the outcome of the negotiations,” Winkelmann said in retrospect. Production at the Clairoix plant will not be resumed. All production employees will be given notice by December 31, 2009, at the latest. All those involved find the solution to be appropriate in the crisis period that has persisted in the automotive supplier industry since the third quarter of 2008.

With sales exceeding €24 billion in 2008, the Continental Corporation is one of the top automotive suppliers worldwide. As a supplier of brake systems, systems and components for the powertrain and chassis, instrumentation, infotainment solutions, vehicle electronics, tires, and technical elastomers, the corporation contributes to enhanced driving safety and protection of the global climate. Continental is also a competent partner in networked automobile communication. The corporation currently employs approximately 133,000 at nearly 190 locations in 35 countries.