German automotive supplier Continental recorded a net loss of 741.1 million euros (878 million U.S. dollars) in the second quarter of 2020 (Q2), down from earnings of 485 million euros in the same quarter last year, the firm announced on Wednesday.
Sales of Continental dropped by 41.2 percent to 6.6 billion euros in Q2. According to the German company, both sales and earnings were "down substantially" due to the effects of the coronavirus pandemic.
"At the low point of the worst economic crisis experienced by the automotive industry since the end of the Second World War, we outperformed our markets," said Elmar Degenhart, chief executive officer (CEO) of Continental.
As a result of temporary plant closures due to the COVID-19 pandemic, the production of passenger cars and light commercial vehicles in Europe and North America had been "very weak" and dropped by 63 percent and 69 percent respectively in the second quarter, the German automotive supplier noted.
In contrast, vehicle production in China in the second quarter increased by nine percent year-on-year, reaching a total of 5.9 million passenger cars and light commercial vehicles, according to Continental.
At the same time, the German automotive supplier reduced its fixed costs by more than 400 million euros. Continental aimed to cut fixed cash costs by more than five percent and reduce capital expenditure by more than 25 percent for the current year.
"We are keeping our targets firmly in sight. Our tough cost-cutting measures are having a quick and noticeable effect," stressed Degenhart.
For the third quarter, Continental is expecting global vehicle production to fall substantially by 10 to 20 percent year-on-year. The German automotive supplier was currently "refraining from providing a detailed outlook for the 2020 fiscal year."
Source: Xinhua |
