BERLIN -- Continental is bracing for tough talks with Volkswagen and other carmakers over prices, though it does not expect to take a major hit on its results, finance chief Wolfgang Schaefer said.
Analysts have said VW, one of Continental's five largest customers, would push price reductions to help limit the costs of its emissions scandal.
Full-year orders in the automotive division, accounting for 60 percent of Continental's sales, may beat 2015 levels after growing by more than a third to over 9 billion euros ($10.35 billion) in the first quarter, Schaefer said in an interview on Wednesday, without being more specific.
Currency effects may shave between 150 and 250 million euros per quarter off group sales, Schaefer said. Headwinds from falling raw material prices may lessen and turn into a 20 million-euro cost burden in the fourth quarter, he added.
The CFO said he was unable to forecast whether the auto parts and tire maker would still make a larger acquisition this year.
Higher cashflow target
Continental raised its guidance for free cashflow on Wednesday, saying it is targeting higher full-year profit after first-quarter earnings rose.
Free cashflow, a key criterion for earnings quality, may increase to at least 2 billion euros ($2.30 billion) by the end of the year, from a previous target of at least 1.8 billion euros, the German supplier said.
Net debt fell to 3.08 billion euros after the first three months from 4.10 billion a year earlier, the company said.
Continental reported key quarterly earnings last Friday, predicting full-year profit to rise on an expected pick-up in the automotive sector after earnings in the January-March period rose on stronger demand for tires and industrial parts.