Charlotte, NC (June 1, 2005) - Today, Continental Tire North America, Inc. (CTNA) announced that tire production at the company's Charlotte, North Carolina manufacturing facility will be reduced to approximately 17,000-18,000 tires per day by July 2005.  Currently, the Charlotte plant produces approximately 25,000 tires per day.  The reasons for the reduction are a substantial increase in inventory levels for certain passenger tire products and high process costs at the Charlotte plant. 

The action will include a work force reduction in the Charlotte plant and will affect approximately 200-300 employees.  CTNA will provide layoff benefits to hourly employees in accordance with its collective bargaining agreement with the United Steel Workers union.  Salaried employees will be provided with layoff benefits in accordance with applicable company policies.

"Unfortunately, this was our only option, as Charlotte is the highest cost plant for Continental Tire," said Rick Ledsinger, Vice President, Human Resources for CTNA. "Although this reduction will impact many of our Charlotte employees, it is critical that Continental Tire continues to make the changes necessary to be competitive in the U. S. tire market.  We will do our utmost to assist our employees at this difficult time."

CTNA will continue to produce tires in North America in order to serve its customers and consumers who have come to trust our products and brands.

About Continental Tire North America, Inc.

Continental Tire North America, Inc. (www.continentaltire.com), based in Charlotte, North Carolina, is a group company of Germany-based Continental AG, a leading systems supplier to the automotive industry. With annual sales of more than a billion dollars, Continental Tire North America, Inc. has about 7,000 employees and operates six plants in North America. CTNA is a major supplier to the original equipment and replacement tire markets, selling Continental, General, Euzkadi and private brands in North America.