Aumovio set for public listing on the 18th of September
Continental Announces Strategic Shift with Division Spin-offs and Focus on Tire Business
Continental AG, a leading automotive technology company, has announced significant changes in its business structure, aiming to optimize its market potential and operational resilience in evolving sectors.
The company's Automotive division, set to be renamed Aumovio upon its spin-off and public listing on September 18, 2025, has shown strong financial and strategic momentum. In Q2 2025, Aumovio achieved an adjusted EBIT margin of 9.0%, significantly outperforming previous years despite challenging market conditions. The division focuses on software-based mobility and vehicle digitalization, supported by a robust €19 billion order book, growth in high-margin products like satellite cameras, brake systems, ECUs, and a new semiconductor joint venture with GlobalFoundries to enhance vertical integration and future-proof supply chains.
The Tire division, which remains the backbone of Continental AG post-spinoff, representing about one-third of consolidated sales with €3.9 billion in Q2 2025, despite a slight year-over-year sales decline due to weak vehicle production, achieved the company’s strongest adjusted EBIT margin, reflecting operational resilience and a refocused global tire strategy under Continental AG.
On the other hand, the ContiTech division, specializing in industrial material solutions, is planned for a spin-off in 2026. It is pivoting away from original equipment vehicle manufacturing towards industrial applications, targeting 80% of its business from industrial clients and discontinuing its OEM original equipment solutions unit. This strategic repositioning aims to enhance its focus and competitive advantage in industrial markets.
| Division | Performance & Focus | Future Plans | |-------------------|---------------------------------------------------------------|--------------------------------------| | Aumovio (Automotive) | 9% EBIT margin, €19B order book, growing in advanced tech (software, semiconductors, etc.) | Spinoff and public listing in Sep 2025; focus on digital mobility and agility | | Tire | Slight sales decline but highest EBIT margin of company | Continental AG to remain focused on Tires as core business post-Automotive spin-off | | ContiTech | Transitioning away from OEM to industrial business (80% target) | Spin-off planned in 2026; refocused on industrial applications |
In addition to these changes, Continental is combating the automotive industry downturn with cost-cutting measures, including reducing its automotive division workforce by 16,000 to around 86,000 employees between 2023 and the end of June 2025. Streamlining business and administrative structures alone is projected to reduce costs by 400 million euros annually from 2025 onwards.
The order intake in the automotive sector exceeded sales in the second quarter, with 5.7 billion euros in order intake and sales falling by 5% (organically: -1.2%) to 4.7 billion euros. The business, which generated sales of 1.9 billion euros in 2024, will be acquired by a financial investor.
CEO Nikolai Setzer confirmed the reduced annual forecasts for the Tire and Contitech divisions. Following the planned sale of the remaining Contitech business in 2026, Continental intends to focus solely on the tire business. The Tire division aims for a margin of 12.5 to 14% in 2025, after 12.7 (13.2)% in the first half of the year.
Olaf Schick, the CFO of Continental, expressed confidence in the prospects of the spin-off of the company's largest division, Aumovio. He also noted further progress in improving earnings in the automotive sector. Continental shareholders, including the Schaeffler family with a 46% stake, will receive one Aumovio share for every two Conti shares.
The adjusted operating profit (Ebit) for the second quarter was around 2% higher than analysts' expectations. Continental attributes the earnings increase in the Automotive division to sustainable price adjustments and implemented cost-cutting measures. The ratio of order intake to sales in the Chinese automotive business is "very strong" at 1.4, while the book-to-bill ratio, which is the ratio of order intake to sales, is 1.2.
These moves indicate Continental’s strategic shift to create distinct, specialized entities positioned to optimize their market potential and operational resilience in evolving sectors.
- The spin-off of Continental's Automotive division, to be named Aumovio, and its transition to a public listed company in 2025, signifies a significant move into the realm of finance and investing, as the division seeks to broaden its market presence and focus on software-based mobility and vehicle digitalization, with a robust order book of €19 billion.
- The ContiTech division, specialized in industrial material solutions, is proceeding with a strategic shift in business focus, aiming to invest heavily in industrial applications, targeting 80% of its business from industrial clients, and diversifying away from its original equipment vehicle manufacturing, in preparation for its planned spin-off in 2026.
