Investing in the future of our employees

The pension system is undergoing a fundamental transformation. Demographic shifts are imposing an increasing burden on state pension systems in Germany and in other markets where Continental also operates. Continental uses internal communication to increase employee awareness of the need to provide for their income in old age by making independent retirement arrangements.

The focus of our international pension strategy is a shift from benefits-oriented to contribution-oriented pension commitments. This is intended to offer both employees and the Company a sustainable and readily understandable pension system.

Continental encourages employees to invest more heavily in private old age pension by topping their investments with supplemental company contributions. The Company provides incentives to motivate employees to pay into a deferred compensation scheme. Per agreement a portion of the employee's pay is then with held by the employer for the company pension scheme. As a consequence of the agreement concluded by the negotiating partners in the chemical industry and in the metal industry, the former tax-free contributions to capital formation are now to be granted specifically and exclusively for retirement pension schemes. As a result of this, the future can be expected to bring a further increase in the rate of participation in this scheme. The main influencing factor for the pre-tax deferred compensation scheme will be the development of tax and social insurance guidelines. A key building block here is the exemption from contribution payment now regulated by law for the conversion of pay into the social security system extending beyond 2008 as well.