Second quarter results are expected to be even worse as core markets, including the us, are hit by the outbreak lockdown ban, and they are looking for a 20 per cent cut in investment after a 26 per cent fall in investment in the first quarter.

    The components giant continental group reported a sharp drop in operating profit in the first quarter due to the impact of the covid-19 pandemic on its business, and a number of major investments will be delayed due to the outbreak.

    Continental said sales in the first quarter were 9.84 billion euros, higher than its previous internal forecast of 9.4 billion euros to 9.8 billion euros, but still below the 11 billion euros recorded in the same period last year.In addition, earnings before interest and tax fell to 436.5 million euros in the quarter from 823.3 million euros in the same period in 2019, a decline of as much as 47%.

    The supplier said in a statement this week that 'the current environment is still fraught with too many uncertainties, such as the duration and severity of production disruptions that are still difficult to predict, and the negative impact on supply chain and market demand that the company had anticipated.'

    New information technology projects that the mainland had planned to invest in this year, plans to expand factory capacity and some investments in autonomous driving technology have all been put on hold as the outbreak continues to take its toll.

    At present, the company can't confirm the specific time to restart the key business, but the chief financial officer, Wolfgang Schaefer is temporarily suspended for automated driving business optimism, "if the investment grade for L4 and L5 autopilot delayed six months, this does not mean that we will lose the market, because this emerging field of the gold market in 10 years."

    Operating margins narrowed from 7.5 per cent to 4.4 per cent, down from 8.8 per cent a year earlier, even as the mainland's first-quarter earnings beat expectations, while revenues at the company's automotive technology division fell 12 per cent.

    The company said in a statement that it expects second-quarter results to be even worse as its core markets, including the United States, are hit by the outbreak lockdown ban, and it is looking for a 20% cut in investment after a 26% drop in the first quarter.

    Wolfgang Schaefer also added that the mainland does not have liquidity problems at this stage and will not apply for government-level loan support.

    Just last month, continental delayed the planned spin-off of its powertrain unit, Vitesco Technologies, citing too much uncertainty in the current economic environment.

    Going back to January this year, Vitesco warned that it was under profit pressure as it worked to switch from internal combustion engines, which account for 90 per cent of revenues, to electrification of electric vehicles in order to achieve new growth at the new four modernisation point.