August 10, 2022: -On Tuesday, Continental expects higher car production in the next half of the year as supply chains and semiconductor availability improve, the company said after reporting a heavy second-quarter loss.

The German auto parts supplier posted a net loss of 251 million euros ($256.05 million) for the April-June quarter, hurt by lockdowns in China, supply chain issues in Europe, higher interest rates, and impairment costs.

“We cannot be entirely satisfied with our present business results even if they are as expected, but we are optimistic for the next half of the year,” Chief Financial Officer Katja Duerrfeld said in a statement.

Continental on Tuesday confirmed preliminary second-quarter results it had released on July 20, which include an adjusted EBIT margin of 4.4% and packed sales of 9.4 billion euros.

It expects an adjusted EBIT margin of 4.7-5.7% on sales of 38.3-40.1 billion euros for the year.

Its outlook includes additional costs of approximately 3.5 billion euros, it said, with freight costs for standard overseas shipping in some cases eight times higher than in previous years.

In response, it said it was spreading its purchasing across multiple sources, stocking higher inventory, sharing rising costs with customers, and focusing its efforts on more premium products.