Stellantis said on Thursday its margins on adjusted operating profits in the first half of 2021 were expected to exceed an annual target of between 5.5%-7.5%, despite production losses due to a global shortage of semiconductor supplies.

The carmaker said a positive pricing and product mix helped it to expect a “strong margin performance” in the first half.

“The global Stellantis team has also responded strongly to volume constraints caused by semiconductor shortages, implementing very effective cost control measures,” it said in a statement ahead of its “EV Day 2021” strategy event scheduled for later on Thursday.

Like its peers, the world’s fourth-largest carmaker with 14 brands including Opel, Jeep, Ram and Maserati, faces an investor community keen for a road map to an electrified line-up to rival Tesla.

Stellantis said that, in line with previous forecasts, it expected a negative industrial free cash flow in the first half, also caused by the negative impact of lower than planned production volumes.

It added, however, that synergies were well on track to exceed the first year’s target, helping to “materially contribute to the full year cash flow performance, which is still expected to be positive”.

 

Formed in January by the merger of France’s PSA and Italian-American group Fiat Chrysler, Stellantis has promised more than 5 billion euros ($5.9 billion) in annual synergies.