By Alex Kapadia
Soaring rubber prices have been causing alarm for bosses at auto parts giant Continental – which credits tyres for two thirds of its sales.
The finance director of the German company voiced the concern, despite an announcement that Continental had got back into the black in the first quarter.
Wolfgang Schaefer said: “At the level of risks, there are two big questions for this year, commodity prices, especially for rubber … and the trend in auto production.
“We win when raw material prices fall and we suffer when they rise, which is unfortunately the case at present,” he explained.
Rubber prices have climbed by around 14 per cent since the beginning of the year tand have gained a staggering 121 per cent since January 2009.
Schaefer said: “We are trying to pass on the increases but that always happens with a delay of up to six months.”
More than two-thirds of Continental’s sales come from tyres, and the group has been slammed by “increases in natural rubber prices that we had never seen before,” he added.
However, earlier this week the German group confirmed a return to profit in the first three months of the year, with a net figure of around £195 million, compared with a loss of £228 million in the same period a year earlier.