Continental (CON) Status Update summary

Strategic transformation and transaction overview

• A 100% spin-off of the Automotive group is planned for September 2025, creating two independent, listed companies with similar scale but distinct market strengths and strategies.

• Both entities will have around €20 billion in sales and approximately 90,000–93,000 employees, aiming for greater agility and targeted investment opportunities.

• The Automotive business will be listed on the Frankfurt Stock Exchange, targeting MDAX inclusion, with a free float of about 54%.

• Transaction costs are projected in the low to mid-three-digit million euro range, with a low three-digit million euro tax effect.

• The process is on track, with key board decisions made, shareholder approval expected at the AGM in April, and capital markets days scheduled for June ahead of the September 25th listing.

Automotive business profile and market positioning

• The Automotive business offers a comprehensive product portfolio for software-defined vehicles, excelling in safety, motion, and advanced driver assistance systems, serving nearly all major global OEMs.

• Over 80% of products are top three in their markets, with significant order intake of €19.3bn in 2024 and strong market share in Asia, Europe, and North America.

• Four main business areas: Autonomous Mobility, Architecture and Network Solutions, Safety and Motion, and User Experience, each with leading market positions and growth potential.

• Strategic partnerships with leading tech firms and a global, regionally diversified footprint support innovation and supply chain resilience.

• Content per vehicle is expected to grow at a 4.7% CAGR from 2024 to 2029, outpacing global light vehicle production growth.

Transformation and operational improvements

• Since 2022, Automotive has executed ~900 product ramp-ups, phased out low-margin clusters, and improved gross margin by ~80bps from 2023 to 2024.

• Achieved a 10k FTE reduction, closed 9 plants since 2019, and improved R&D cost efficiency, with further plant closures and cost reductions planned.

• Working capital and CapEx efficiency have been enhanced, boosting free cash flow by over €1 billion in 2024.

• Return on sales improved from 0.1% in 2022 to 2.5% in 2024, with a return on sales exceeding 6% in Q4 2024.

• Additional cost savings are targeted through further plant closures, SG&A reductions, and R&D optimization, with CapEx aimed below 5% of sales.