Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Number of shares of common stock outstanding as of ~~October 26, 2020: 25,591,930��~~July 30, 2021: 26,107,462

	Three Months Ended						Nine Months Ended						Three Months Ended						Six Months Ended
	September 30, 2020			September 30, 2019			September 30, 2020			September 30, 2019			June 30, 2021			June 30, 2020			June 30, 2021			June 30, 2020
NET SALES	$	317,103		$	352,014		$	763,050		$	1,062,206		$	347,464		$	144,835		$	705,660		$	445,947
Cost of sales		285,135			335,967			730,762			973,042			314,844			167,676			630,000			445,627
GROSS PROFIT		31,968			16,047			32,288			89,164
GROSS PROFIT (LOSS)														32,620			(22,841	)		75,660			320
Selling, general and administrative expenses		12,730			16,290			36,541			46,737			17,100			11,276			34,421			23,811
Impairment of goodwill and indefinite-lived intangibles		—			—			193,641			—			—			—			—			193,641
INCOME (LOSS) FROM OPERATIONS		19,238			(243	)		(197,894	)		42,427			15,520			(34,117	)		41,239			(217,132	)
Interest expense, net		(10,414	)		(11,807	)		(34,448	)		(35,532	)		(10,486	)		(12,184	)		(20,759	)		(24,034	)
Other (expense) income, net		(1,576	)		634			(923	)		3,393			(2,420	)		(670	)		(3,934	)		653
INCOME (LOSS) BEFORE INCOME TAXES		7,248			(11,416	)		(233,265	)		10,288			2,614			(46,971	)		16,546			(240,513	)
Income tax benefit (provision)		3,898			4,785			11,111			(7,699	)
Income tax (provision) benefit														(919	)		3,753			(1,729	)		7,213
NET INCOME (LOSS)	$	11,146		$	(6,631	)	$	(222,154	)	$	2,589		$	1,695		$	(43,218	)	$	14,817		$	(233,300	)
EARNINGS (LOSS) PER SHARE – BASIC	$	0.12		$	(0.57	)	$	(9.66	)	$	(0.84	)
EARNINGS (LOSS) PER SHARE – DILUTED	$	0.12		$	(0.57	)	$	(9.66	)	$	(0.84	)
LOSS PER SHARE – BASIC													$	(0.26	)	$	(2.00	)	$	(0.07	)	$	(9.81	)
LOSS PER SHARE – DILUTED													$	(0.26	)	$	(2.00	)	$	(0.07	)	$	(9.81	)

The accompanying unaudited notes are an integral part of these condensed consolidated financial statements.

	Three Months Ended						Nine Months Ended						Three Months Ended						Six Months Ended
	September 30, 2020			September 30, 2019			September 30, 2020			September 30, 2019			June 30, 2021			June 30, 2020			June 30, 2021			June 30, 2020
Net income (loss)	$	11,146		$	(6,631	)	$	(222,154	)	$	2,589		$	1,695		$	(43,218	)	$	14,817		$	(233,300	)
Other comprehensive income (loss), net of tax:
Foreign currency translation gain (loss)		16,384			(22,143	)		(9,706	)		(21,459	)		8,410			9,443			(7,268	)		(26,090	)
Change in unrecognized gains (losses) on derivative instruments:
Change in fair value of derivatives		5,818			(10,406	)		(32,934	)		(1,862	)		17,165			19,673			8,025			(38,752	)
Tax (provision) benefit		(1,135	)		2,104			7,618			342			(1,718	)		(4,375	)		(1,040	)		8,753
Change in unrecognized gains (losses) on derivative instruments, net of tax		4,683			(8,302	)		(25,316	)		(1,520	)		15,447			15,298			6,985			(29,999	)
Defined benefit pension plan:
Amortization of actuarial losses on pension obligations		72			50			216			155
Tax (provision)		(15	)		(11	)		(45	)		(33	)
Actuarial gains on pension obligation, net of amortization														97			72			194			144
Tax benefit (provision)														21			(13	)		—			(30	)
Pension changes, net of tax		57			39			171			122			118			59			194			114
Other comprehensive income (loss), net of tax		21,124			(30,406	)		(34,851	)		(22,857	)		23,975			24,800			(89	)		(55,975	)
Comprehensive income (loss)	$	32,270		$	(37,037	)	$	(257,005	)	$	(20,268	)	$	25,670		$	(18,418	)	$	14,728		$	(289,275	)

The accompanying unaudited notes are an integral part of these condensed consolidated financial statements.

	September 30, 2020			December 31, 2019			June 30, 2021			December 31, 2020
ASSETS
Current assets:
Cash and cash equivalents	$	111,131		$	77,927		$	149,171		$	152,423
Accounts receivable, net		77,675			76,786			85,065			48,995
Inventories, net		141,287			168,470			197,990			154,980
Income taxes receivable		4,067			4,630			5,334			4,957
Other current assets		16,329			26,375			24,586			22,301
Total current assets		350,489			354,188			462,146			383,656
Property, plant and equipment, net		507,037			529,282			503,086			522,124
Deferred income tax assets, net		53,307			38,607			27,940			30,860
Goodwill		—			184,832			—			—
Intangibles, net		112,341			137,078			93,942			110,796
Other non-current assets		55,837			67,880			61,241			61,889
Total assets	$	1,079,011		$	1,311,867		$	1,148,355		$	1,109,325
LIABILITIES, MEZZANINE EQUITY AND SHAREHOLDERS’ EQUITY (DEFICIT)
Current liabilities:
Accounts payable	$	149,808		$	123,112		$	190,386		$	151,839
Short-term debt		6,034			4,010			6,545			6,112
Accrued expenses		72,857			60,845			75,567			71,079
Income taxes payable		2,208			3,148			1,408			2,107
Total current liabilities		230,907			191,115			273,906			231,137
Long-term debt (less current portion)		611,706			611,025			617,212			625,492
Non-current income tax liabilities		7,451			6,523			7,682			7,635
Deferred income tax liabilities, net		—			12,369			4,680			9,104
Other non-current liabilities		81,321			71,640			74,476			76,426
Commitments and contingent liabilities (Note 17)		—			—
Mezzanine equity:
Preferred stock, $0.01 par value
Authorized - 1,000,000 shares
Issued and outstanding – 150,000 shares outstanding at September 30, 2020 and December 31, 2019		174,597			160,980
Issued and outstanding – 150,000 shares outstanding at June 30, 2021 and December 31, 2020								189,364			179,387
European non-controlling redeemable equity		1,580			6,525			1,590			1,666
Shareholders’ equity (deficit):
Common stock, $0.01 par value
Authorized - 100,000,000 shares
Issued and outstanding – 25,591,930 and 25,128,158 shares at September 30, 2020 and December 31, 2019		94,058			93,331
Issued and outstanding – 26,107,462 and 25,591,930 shares at June 30, 2021 and December 31, 2020								98,236			95,247
Accumulated other comprehensive loss		(134,929	)		(100,078	)		(99,535	)		(99,446	)
Retained earnings		12,320			258,437			(19,256	)		(17,323	)
Total shareholders’ equity (deficit)		(28,551	)		251,690			(20,555	)		(21,522	)
Total liabilities, mezzanine equity and shareholders’ equity (deficit)	$	1,079,011		$	1,311,867		$	1,148,355		$	1,109,325

The accompanying unaudited notes are an integral part of these condensed consolidated financial statements.

	Nine Months Ended						Six Months Ended
	September 30, 2020			September 30, 2019			June 30, 2021			June 30, 2020
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss) income	$	(222,154	)	$	2,589
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Net income (loss)							$	14,817		$	(233,300	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization		73,134			77,500			50,970			48,316
Income tax, non-cash changes		(19,389	)		(3,472	)		(2,927	)		(13,975	)
Impairment of goodwill and indefinite-lived intangibles		193,641			—			—			193,641
Stock-based compensation		727			3,695			4,331			210
Amortization of debt issuance costs		3,140			3,681			2,731			2,261
Other non-cash items		(1,493	)		444			(3,928	)		(2,456	)
Changes in operating assets and liabilities:
Accounts receivable		(4,062	)		(30,464	)		(37,231	)		9,839
Inventories		29,292			9,028			(46,139	)		17,053
Other assets and liabilities		11,520			20,313			15,894			1,186
Accounts payable		27,438			11,176			34,402			(31,276	)
Income taxes		717			7,861			(987	)		1,366
NET CASH PROVIDED BY OPERATING ACTIVITIES		92,511			102,351
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES								31,933			(7,135	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to property, plant and equipment		(33,592	)		(47,584	)
Proceeds from sale of fixed assets		859			—
Other investing activities		—			9,631
Additions to property, plant, and equipment								(20,551	)		(22,761	)
NET CASH USED IN INVESTING ACTIVITIES		(32,733	)		(37,953	)		(20,551	)		(22,761	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of long-term debt		11,690			—			1,658			11,690
Repayments of debt		(24,851	)		(35,015	)		(2,129	)		(24,066	)
Cash dividends paid		(10,161	)		(19,171	)
Purchase of non-controlling redeemable shares		(4,981	)		(3,888	)
Payments related to tax withholdings for stock-based compensation		—			(108	)
Proceeds from borrowings on revolving credit facility		313,825			69,600			—			213,825
Repayments of borrowings on revolving credit facility		(316,910	)		(69,600	)		—			(106,992	)
Other financing activities		(723	)		(1,035	)
NET CASH USED IN FINANCING ACTIVITIES		(32,111	)		(59,217	)
Cash dividends paid								(6,736	)		(6,767	)
Financing costs paid and other								(4,307	)		(4,938	)
Payments related to tax withholdings for stock-based compensation								(1,342	)		—
Finance lease payments								(645	)		(547	)
NET CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES								(13,501	)		82,205
Effect of exchange rate changes on cash		5,537			(3,337	)		(1,133	)		496
Net increase in cash and cash equivalents		33,204			1,844
Net (decrease) increase in cash and cash equivalents								(3,252	)		52,805
Cash and cash equivalents at the beginning of the period		77,927			47,464			152,423			77,927
Cash and cash equivalents at the end of the period	$	111,131		$	49,308		$	149,171		$	130,732

The accompanying unaudited notes are an integral part of these condensed consolidated financial statements.

(Unaudited)

Common Stock

Accumulated Other Comprehensive (Loss)
Income

Number of
Shares

Amount

Unrecognized
Gains (Losses)
on Derivative
Instruments

Pension
Obligations

Cumulative
Translation
Adjustment

Retained
Earnings

Total

BALANCE AT DECEMBER 31, 2018

25,019,237

$
87,723

$
(3,205
)

$
(3,000
)

$
(99,290
)

$
391,037

$
373,265

Net income

—

—

—

—

—

2,589

2,589

Change in unrecognized gains/losses on derivative
   instruments, net of tax

—

—

(1,520
)

—

—

—

(1,520
)

Change in employee benefit plans, net of taxes

—

—

—

122

—

—

122

Net foreign currency translation adjustment

—

—

—

—

(21,459
)

—

(21,459
)

Common stock issued, net of shares withheld for
   employee taxes

108,921

—

—

—

—

—

—

Stock-based compensation

—

3,587

—

—

—

—

3,587

Cash dividend declared ($0.09 per common
   share)

—

—

—

—

—

(4,597
)

(4,597
)

Redeemable preferred 9% dividend, participating
   dividend and accretion

—

—

—

—

—

(23,275
)

(23,275
)

European non-controlling redeemable equity
   dividend

—

—

—

—

—

(496
)

(496
)

BALANCE AT SEPTEMBER 30, 2019

25,128,158

$
91,310

$
(4,725
)

$
(2,878
)

$
(120,749
)

$
365,258

$
328,216

For the three months ended September 30, 2019

(Unaudited)

Common Stock

Accumulated Other Comprehensive (Loss)
Income

Number of
Shares

Amount

Unrecognized
Gains (Losses)
on Derivative
Instruments

Pension
Obligations

Cumulative
Translation
Adjustment

Retained
Earnings

Total

BALANCE AT JUNE 30, 2019

25,114,598

$
89,532

$
3,577

$
(2,917
)

$
(98,606
)

$
379,604

$
371,190

Net loss

—

—

—

—

—

(6,631
)

(6,631
)

Change in unrecognized gains/losses on derivative
   instruments, net of tax

—

—

(8,302
)

—

—

—

(8,302
)

Change in employee benefit plans, net of taxes

—

—

—

39

—

—

39

Net foreign currency translation adjustment

—

—

—

—

(22,143
)

—

(22,143
)

Common stock issued, net of shares withheld for
   employee taxes

13,560

—

—

—

—

—

—

Stock-based compensation

—

1,778

—

—

—

—

1,778

Cash dividend declared ($0.09 per common
   share)

—

—

—

—

—

(15
)

(15
)

Redeemable preferred 9% dividend and accretion

—

—

—

—

—

(7,587
)

(7,587
)

European non-controlling redeemable equity
   dividend

—

—

—

—

—

(113
)

(113
)

BALANCE AT SEPTEMBER 30, 2019

25,128,158

$
91,310

$
(4,725
)

$
(2,878
)

$
(120,749
)

$
365,258

$
328,216

For the six months ended June 30, 2020
	Common Stock				Accumulated Other Comprehensive (Loss) Income
	Number of Shares		Amount		Unrecognized Gains (Losses) on Derivative Instruments			Pension Obligations			Cumulative Translation Adjustment			Retained Earnings			Total
BALANCE AT DECEMBER 31, 2019		25,128,158	$	93,331	$	9,951		$	(5,571	)	$	(104,458	)	$	258,437		$	251,690
Net loss		—		—		—			—			—			(233,300	)		(233,300	)
Change in unrecognized gains/losses on derivative instruments, net of tax		—		—		(29,999	)		—			—			—			(29,999	)
Change in defined benefit plans, net of taxes		—		—		—			114			—			—			114
Net foreign currency translation adjustment		—		—		—			—			(26,090	)		—			(26,090	)
Common stock issued, net of shares withheld for employee taxes		463,772		—		—			—			—			—			—
Stock-based compensation		—		210		—			—			—			—			210
Redeemable preferred 9% dividend and accretion		—		—		—			—			—			(15,755	)		(15,755	)
European non-controlling redeemable equity dividend		—		—		—			—			—			(46	)		(46	)
BALANCE AT JUNE 30, 2020		25,591,930	$	93,541	$	(20,048	)	$	(5,457	)	$	(130,548	)	$	9,336		$	(53,176	)

For the three months ended June 30, 2020
	Common Stock				Accumulated Other Comprehensive (Loss) Income
	Number of Shares		Amount		Unrecognized Gains (Losses) on Derivative Instruments			Pension Obligations			Cumulative Translation Adjustment			Retained Earnings			Total
BALANCE AT MARCH 31, 2020		25,474,477	$	92,678	$	(35,346	)	$	(5,516	)	$	(139,991	)	$	60,485		$	(27,690	)
Net loss		—		—		—			—			—			(43,218	)		(43,218	)
Change in unrecognized gains/losses on derivative instruments, net of tax		—		—		15,298			—			—			—			15,298
Change in defined benefit plans, net of taxes		—		—		—			59			—			—			59
Net foreign currency translation adjustment		—		—		—			—			9,443			—			9,443
Common stock issued, net of shares withheld for employee taxes		117,453		—		—			—			—			—			—
Stock-based compensation		—		863		—			—			—			—			863
Redeemable preferred 9% dividend and accretion		—		—		—			—			—			(7,905	)		(7,905	)
European non-controlling redeemable equity dividend		—		—		—			—			—			(26	)		(26	)
BALANCE AT JUNE 30, 2020		25,591,930	$	93,541	$	(20,048	)	$	(5,457	)	$	(130,548	)	$	9,336		$	(53,176	)

(Unaudited)

Common Stock

Accumulated Other Comprehensive (Loss)
Income

Number of
Shares

Amount

Unrecognized
Gains (Losses)
on Derivative
Instruments

Pension
Obligations

Cumulative
Translation
Adjustment

Retained
Earnings

Total

BALANCE AT DECEMBER 31, 2019

25,128,158

$
93,331

$
9,951

$
(5,571
)

$
(104,458
)

$
258,437

$
251,690

Net loss

—

—

—

—

—

(222,154
)

(222,154
)

Change in unrecognized gains/losses on derivative
   instruments, net of tax

—

—

(25,316
)

—

—

—

(25,316
)

Change in employee benefit plans, net of taxes

—

—

—

171

—

—

171

Net foreign currency translation adjustment

—

—

—

—

(9,706
)

—

(9,706
)

Common stock issued, net of shares withheld for
   employee taxes

463,772

—

—

—

—

—

—

Stock-based compensation

—

727

—

—

—

—

727

Redeemable preferred 9% dividend and accretion

—

—

—

—

—

(23,811
)

(23,811
)

European non-controlling redeemable equity
   dividend

—

—

—

—

—

(152
)

(152
)

BALANCE AT SEPTEMBER 30, 2020

25,591,930

$
94,058

$
(15,365
)

$
(5,400
)

$
(114,164
)

$
12,320

$
(28,551
)

For the three months ended September 30, 2020

(Unaudited)

Common Stock

Accumulated Other Comprehensive (Loss)
Income

Number of
Shares

Amount

Unrecognized
Gains (Losses)
on Derivative
Instruments

Pension
Obligations

Cumulative
Translation
Adjustment

Retained
Earnings

Total

BALANCE AT JUNE 30, 2020

25,591,930

$
93,541

$
(20,048
)

$
(5,457
)

$
(130,548
)

$
9,336

$
(53,176
)

Net income

—

—

—

—

—

11,146

11,146

Change in unrecognized gains/losses on derivative
   instruments, net of tax

—

—

4,683

—

—

—

4,683

Change in employee benefit plans, net of taxes

—

—

—

57

—

—

57

Net foreign currency translation adjustment

—

—

—

—

16,384

—

16,384

Common stock issued, net of shares withheld for
   employee taxes

—

—

—

—

—

—

—

Stock-based compensation

—

517

—

—

—

—

517

Redeemable preferred 9% dividend and accretion

—

—

—

—

—

(8,056
)

(8,056
)

European non-controlling redeemable equity
   dividend

—

—

—

—

—

(106
)

(106
)

BALANCE AT SEPTEMBER 30, 2020

25,591,930

$
94,058

$
(15,365
)

$
(5,400
)

$
(114,164
)

$
12,320

$
(28,551
)

For the six months ended June 30, 2021
	Common Stock				Accumulated Other Comprehensive (Loss) Income
	Number of Shares		Amount		Unrecognized Gains (Losses) on Derivative Instruments			Pension Obligations			Cumulative Translation Adjustment			Retained Earnings			Total
BALANCE AT DECEMBER 31, 2020		25,591,930	$	95,247	$	(1,738	)	$	(7,447	)	$	(90,261	)	$	(17,323	)	$	(21,522	)
Net income		—		—		—			—			—			14,817			14,817
Change in unrecognized gains/losses on derivative instruments, net of tax		—		—		6,985			—			—			—			6,985
Change in defined benefit plans, net of taxes		—		—		—			194			—			—			194
Net foreign currency translation adjustment		—		—		—			—			(7,268	)		—			(7,268	)
Common stock issued, net of shares withheld for employee taxes		515,532		—		—			—			—			—			—
Stock-based compensation		—		2,989		—			—			—			—			2,989
Redeemable preferred 9% dividend and accretion		—		—		—			—			—			(16,712	)		(16,712	)
European non-controlling redeemable equity dividend		—		—		—			—			—			(38	)		(38	)
BALANCE AT JUNE 30, 2021		26,107,462	$	98,236	$	5,247		$	(7,253	)	$	(97,529	)	$	(19,256	)	$	(20,555	)

For the three months ended June 30, 2021
	Common Stock				Accumulated Other Comprehensive (Loss) Income
	Number of Shares		Amount		Unrecognized Gains (Losses) on Derivative Instruments			Pension Obligations			Cumulative Translation Adjustment			Retained Earnings			Total
BALANCE AT MARCH 31, 2021		25,947,462	$	95,752	$	(10,200	)	$	(7,371	)	$	(105,939	)	$	(12,504	)	$	(40,262	)
Net income		—		—		—			—			—			1,695			1,695
Change in unrecognized gains/losses on derivative instruments, net of tax		—		—		15,447			—			—			—			15,447
Change in defined benefit plans, net of taxes		—		—		—			118			—			—			118
Net foreign currency translation adjustment		—		—		—			—			8,410			—			8,410
Common stock issued, net of shares withheld for employee taxes		160,000		—		—			—			—			—			—
Stock-based compensation		—		2,484		—			—			—			—			2,484
Redeemable preferred 9% dividend and accretion		—		—		—			—			—			(8,422	)		(8,422	)
European non-controlling redeemable equity dividend		—		—		—			—			—			(25	)		(25	)
BALANCE AT JUNE 30, 2021		26,107,462	$	98,236	$	5,247		$	(7,253	)	$	(97,529	)	$	(19,256	)	$	(20,555	)

The accompanying unaudited notes are an integral part of these condensed consolidated financial statements.

NOTE 1 – NATURE OF OPERATIONS AND PRESENTATION OF CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Superior Industries International, Inc.’s (referred herein as the “Company,” “Superior,” or “we” and “our”) principal business is the design and manufacture of aluminum wheels for sale to original equipment manufacturers ~~(OEMs)~~(“OEMs”) in North America and Europe and to the aftermarket ~~distributors~~ in Europe. We employ approximately ~~7,500~~7,700 full-time employees, operating in 8 manufacturing facilities in North America and ~~Europe with a combined annual manufacturing capacity of approximately 20 million wheels.~~Europe. We are one of the largest aluminum wheel suppliers to global OEMs and we believe we are the #1 European aluminum wheel aftermarket manufacturer and supplier. Our OEM aluminum wheels accounted for approximately 92 percent of our sales in the first ~~nine~~six months of ~~2020~~2021 and are primarily sold for factory installation on vehicle models manufactured by BMW (including Mini), Daimler AG Company (Mercedes-Benz, AMG, Smart), ~~FCA,~~ Ford, GM, Honda, Jaguar-Land Rover, Lucid Motors, Mazda, ~~Mitsubishi,~~ Nissan, PSA, Renault, Subaru, Stellantis, Suzuki, Toyota, VW Group (Volkswagen, Audi, SEAT, Skoda, Porsche, Bentley) and Volvo. We also sell aluminum wheels to the European aftermarket under the brands ATS, RIAL, ALUTEC and ANZIO. North America and Europe represent the principal markets for our products, but we have a diversified global ~~presence and diversified~~ customer base consisting of North American, European and Asian OEMs. We have determined that our North American and European operations should be treated as separate reportable segments as further described in Note 5, “Business Segments.”

The accompanying unaudited condensed consolidated financial statements have been prepared in ~~accordance~~conformity with ~~the Security and Exchange Commission’s (“SEC’s”) requirements for quarterly reports on Form 10-Q and~~ U.S. Generally Accepted Accounting Principles (“GAAP”) pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information. Accordingly, they do not include all the information and notes required by U.S. GAAP for complete financial statements. These unaudited condensed consolidated financial statements, in our opinion, ~~contain~~include all adjustments, of a normal and recurring nature, which are necessary for fair presentation of (i) the condensed consolidated statements of income (loss) for the three and ~~nine-month~~six-month periods ended ~~September~~June 30, ~~2020~~2021 and ~~September~~June 30, ~~2019,~~2020, (ii) the condensed consolidated statements of comprehensive income (loss) for the three and ~~nine-month~~six-month periods ended ~~September~~June 30, ~~2020~~2021 and ~~September~~June 30, ~~2019,~~2020, (iii) the condensed consolidated balance sheets at ~~September~~June 30, ~~2020~~2021 and December 31, ~~2019,~~2020, (iv) the condensed consolidated statements of cash flows for the ~~nine-month~~six-month periods ended ~~September~~June 30, ~~2020~~2021 and ~~September~~June 30, ~~2019,~~2020, and (v) the condensed consolidated statements of shareholders’ equity (deficit) for the three and ~~nine-month~~six-month periods ended ~~September~~June 30, ~~2020~~2021 and ~~September~~June 30, ~~2019.~~2020. This Quarterly Report on Form 10-Q should be read in conjunction with our consolidated financial statements and notes thereto filed with the SEC in our ~~2019~~2020 Annual Report on Form 10-K.

Interim financial reporting standards require us to make estimates that are based on assumptions regarding the outcome of future events and circumstances not known at that ~~time, including the use of estimated effective tax rates.~~time. Inevitably, some assumptions will not materialize, unanticipated events or circumstances may occur which vary from those estimates and such variations may significantly affect our future results. Additionally, interim results may not be indicative of our results for future interim periods or our annual results.

Certain prior year amounts have been reclassified to conform with the current year presentation.

Cash paid for interest was ~~$27.1~~$18.3 million and ~~$28.2~~$21.5 million for the ~~nine~~six months ended ~~September~~June 30, ~~2020~~2021 and ~~September~~June 30, ~~2019,~~2020, respectively. Net cash paid for income taxes ~~paid~~ was ~~$7.6~~$5.9 million and ~~$6.5~~$5.4 million for the ~~nine~~six months ended ~~September~~June 30, ~~2020~~2021 and ~~September~~June 30, ~~2019,~~2020, respectively. As of ~~September~~June 30, 2021 and June 30, 2020, ~~and September 30, 2019, $0.2~~$7.8 million and ~~$15.8~~$2.9 million, respectively, of equipment had been purchased but not yet paid and was included in accounts payable in our condensed consolidated balance sheets.

~~Accounting Standards Update (“ASU”) 2018-13, “Fair Value Measurement~~.” ~~Effective January 1, 2020, the Company adopted ASU 2018-13 which allows companies to~~ ~~remove, modify and add certain disclosures related to fair value measurements.~~ ~~The adoption of this standard did not have a~~ ~~significant impact on the Company’s condensed consolidated financial statement disclosures.~~

~~ASU~~Accounting Standards Update (ASU) 2016-13, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” In June 2016, the Financial Accounting Standards Board (“FASB”) issued ASU 2016-13, "Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments", which requires entities to use a new impairment model based on current expected credit losses (“CECL”) rather than incurred losses. Under CECL, estimated credit losses would incorporate relevant information about past events, current conditions and reasonable and supportable forecasts and any expected credit losses would be recognized at the time of sale. ~~As a smaller reporting company (as defined under SEC regulations), the~~The Company is not required to adopt the standard until ~~fiscal years beginning after December 31, 2022.~~January 1, 2023. We are evaluating the impact this standard will have on our financial statements and disclosures.

~~ASU 2018-14, “Compensation - Retirement Benefits - Defined Benefit Plans.”~~ In August 2018, the FASB issued an ASU entitled “Compensation - Retirement Benefits - Defined Benefit Plans - General Subtopic 715-20 - Disclosure Framework - Changes to the Disclosure Requirements for Defined Benefit Plans” (ASU 2018-14), which is designed to improve the effectiveness of disclosures by removing and adding disclosures related to defined benefit plans. ASU 2018-14 is effective for fiscal years ending after December 15, 2020. We are evaluating the impact this new standard will have on our financial statement disclosures.

~~ASU 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting.”~~ In March 2020, the FASB issued ASU 2020-04 entitled “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting,” which provides temporary optional guidance to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting. The relief provided by this guidance is elective and applies to all entities, subject to meeting certain criteria, that have contracts, hedging relationships, and other transactions that reference the London Interbank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued because of reference rate reform initiatives being undertaken in an effort to identify alternative reference rates that are more observable or transaction based and less susceptible to manipulation. The optional amendments of this guidance are effective for all entities upon adoption. We are currently assessing the impact of this new standard on our financial statements and disclosures.

~~In accordance with Accounting Standards Codification (“ASC”) 606, “Revenue from Contracts with Customers,” the~~The Company disaggregates revenue from contracts with customers into our reportable segments, North America and Europe. Revenues by segment for the three and ~~nine-month~~six-month periods ended ~~September~~June 30, 2021 and June 30, 2020, ~~and 2019~~respectively, are summarized in Note 5, “Business Segments.”

The opening and closing balances of the Company’s customer receivables and current and long-term contract liabilities balances ~~as of September 30, 2020 and December 31, 2019~~ are as ~~follows (in thousands):~~follows:

The Company applies fair value accounting for all financial assets and liabilities and non-financial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring basis, while other assets and liabilities are measured at fair value on a nonrecurring basis, such as an asset impairment. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement:

Level 2 - Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3 - Inputs that are generally unobservable and typically reflect management’s estimate of assumptions that market participants would use in pricing the asset or liability.

The carrying amounts for cash and cash equivalents, accounts receivable, accounts payable and accrued expenses approximate their fair values due to the short period of time until maturity.

~~Cash and cash equivalents generally consist of cash, certificates of deposit and fixed deposits and money market funds with original maturities of three months or less.~~

Our derivatives are over-the-counter customized derivative transactions and are not exchange traded. We estimate the fair value of these instruments using industry-standard valuation models such as discounted cash flow. These models project future cash flows and discount the future amounts to a present value using market-based expectations for interest rates, foreign exchange rates, commodity prices and the contractual terms of the derivative instruments. The discount rate used is the relevant interbank deposit rate (e.g., LIBOR) plus an adjustment for non-performance risk.

The following tables categorize items measured at fair value as of ~~September~~June 30, ~~2020~~2021 and December 31, ~~2019:~~2020:

The carrying values of the Company’s debt instruments vary from their fair values. The fair values were determined by reference to transacted prices ofand quotes for these instruments (Level ~~2 input based on the U.S. GAAP fair value hierarchy)~~2). The estimated fair value, as well as the carrying value, of the Company’s debt instruments are shown below:

We use derivatives to partially offset our exposure to foreign currency, interest rate, aluminum and other commodity price ~~risk.~~risks. We may enter into forward contracts, option contracts, swaps, collars or other derivative instruments to offset some of the risk on expected future cash flows and on certain existing assets and liabilities. However, we may choose not to hedge certain exposures for a variety of reasons including, but not limited to, accounting considerations and the prohibitive economic cost of hedging particular exposures. There can be no assurance the hedges will offset ~~more than a portion of~~ the full financial impact resulting from movements in foreign currency exchange rates, interest rates, and aluminum or other commodity prices.

To help ~~protect~~mitigate gross ~~margins from~~margin fluctuations due to changes in foreign currency exchange rates, certain of our subsidiaries, whose functional currency is the U.S. dollar or the Euro, hedge a portion of their forecasted foreign currency costs denominated in the Mexican Peso and Polish Zloty, respectively. We may hedge portions of our forecasted foreign currency exposure up to 48 months.

We record all derivatives in the condensed consolidated balance sheets at fair value. Our accounting treatment for these instruments is based on the hedge designation. Gains or losses on derivatives that are designated as hedging instruments are recorded in accumulated other comprehensive income (loss) (“AOCI”) until the hedged item is recognized in earnings, at which point accumulated gains or losses will be recognized in earnings and classified with the underlying hedged transaction. Derivatives that are not designated as hedging instruments are adjusted to fair value through earnings in the financial statement line item to which the derivative relates. The Company has derivatives that are designated as hedging instruments, as well as derivatives that do not qualify for designation as hedging instruments.

The following tables display the fair value of derivatives by balance sheet line item at ~~September~~June 30, ~~2020~~2021 and December 31, ~~2019:~~2020:

The following table summarizes the notional amount and estimated fair value of our derivative financial instruments:

Notional amounts are presented on a net basis. The notional amounts of the derivative financial instruments do not represent amounts exchanged by the parties and, therefore, are not a direct measure of our exposure to the financial risks. The amounts exchanged are calculated by reference to the notional amounts and by other terms of the derivatives, such as interest rates, foreign currency exchange rates or commodity prices.

The following tables summarize the gain or loss recognized in AOCI, ~~as of September 30, 2020 and 2019,~~ the amounts reclassified from AOCI into earnings and the amounts recognized directly into earnings for the three and ~~nine~~six months ended ~~September~~June 30, ~~2020~~2021 and ~~2019:~~2020:

The North American and European businesses represent separate operating segments in view of significantly different markets, customers and products in each of these regions. Within each of these regions, markets, customers, products and production processes are ~~similar and production can be transferred between production facilities.~~similar. Moreover, our business within each region generally leverages common systems, processes and infrastructure. Accordingly, North America and Europe comprise the Company’s reportable segments.

Net sales and long-lived assets by ~~manufacturing geographic~~ location are as follows:

(Dollars in thousands)									Three Months Ended				Six Months Ended
	Three Months Ended				Nine Months Ended				June 30, 2021		June 30, 2020		June 30, 2021		June 30, 2020
	September 30, 2020		September 30, 2019		September 30, 2020		September 30, 2019
(Dollars in thousands)
Net sales:
U.S.	$	5,094	$	26,916	$	24,890	$	81,638	$	1,549	$	3,619	$	2,819	$	19,796
Mexico		161,568		161,173		356,239		471,969		175,441		55,297		366,142		194,671
Germany		58,413		59,548		142,177		180,785		62,511		33,726		123,398		83,764
Poland		92,028		104,377		239,744		327,814		107,963		52,193		213,301		147,716
Consolidated net sales	$	317,103	$	352,014	$	763,050	$	1,062,206	$	347,464	$	144,835	$	705,660	$	445,947


(Dollars in thousands)													Property, Plant and Equipment, net
													June 30, 2021		December 31, 2020
U.S.													$	4,343	$	7,324
Mexico														204,673		212,821
Germany														82,527		82,162
Poland														211,543		219,817
Property, plant and equipment, net													$	503,086	$	522,124

Service wheel and supplies inventory included in other non-current assets in the condensed consolidated balance sheets totaled ~~$10.8~~$10.3 million and ~~$10.6~~$12.1 million at ~~September~~June 30, ~~2020~~2021 and December 31, ~~2019,~~2020, respectively.

Depreciation expense for the three and ~~nine~~six months ended ~~September~~June 30, ~~2020~~2021 was ~~$18.3~~$18.9 million and ~~$54.4~~$37.6 million, respectively.

Depreciation expense for the three and ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020 was ~~$24.2~~$17.8 million and ~~$57.4~~$36.1 million, respectively. Depreciation expense for the three months ended September 30, 2019 included accelerated depreciation of $7.6 million related to excess equipment arising from the plan to reduce production at our Fayetteville, Arkansas manufacturing facility (refer to Note 19, “Restructuring”).

At March 31, 2020, the impact of COVID-19 and uncertainty with respect to the economic effects of the pandemic had introduced significant volatility in the financial markets and was having ~~and continues to have,~~ a widespread adverse effect on the automotive ~~industry, including reductions in both consumer demand and OEM automotive production.~~industry. In response to the COVID-19 pandemic, our key customers temporarily closed nearly all their production facilities in Europe and North America (our primary markets) during the quarter ended March 31, 2020. As a result, we concluded that an interim test of our goodwill was required as of March 31, 2020. More specifically, the Company concluded that the following events and circumstances, in the aggregate, indicated that it was more likely than not that the carrying value of our European reporting unit exceeded its fair value: (1) our European reporting unit’s carrying value was effectively set to fair value at December 31, 2019, due to the $102.2 million impairment charges to goodwill and indefinite-lived intangibles, (2) lower forecasted 2020 industry production volumes for Western and Central Europe, including those for our primary European customers, due to OEM shutdowns to mitigate COVID-19 spread and subsequent reduced production levels over the remainder of the year, as compared to our prior production forecasts (including estimates used in our 2019 assessment) and (3) the volatility in financial markets that ~~has~~had both increased European interest rates due to rising credit spreads and risk premiums and lowered median European automotive market multiples. Based on the results of our quantitative analysis, we recognized a non-cash goodwill impairment charge equal to the remaining goodwill balance of $182.6 million since the carrying value exceeded the fair value of the European reporting unit by more than the amount of the goodwill balance at March 31, 2020. Additionally, we recognized a non-cash impairment charge of $11.0 million related to our aftermarket trade name indefinite-lived intangible asset which was primarily attributable to a further decline in forecasted aftermarket revenues and a decline in associated profitability. Total impairment charges of $193.6 million were recognized as a separate charge at March 31, 2020 and included in income (loss) from operations.

We utilized both an income and a market approach, weighted 75 percent and 25 percent respectively, to determine the fair value of the European reporting unit as part of our goodwill impairment assessment. The income approach is based on projected debt-free cash flow, which is discounted to the present value using discount factors that consider the timing and risk of cash flows. The discount rate used is the weighted average of an estimated cost of equity and of debt (“weighted average cost of capital”). The weighted average cost of capital is adjusted as necessary to reflect risk associated with the business of the European reporting unit. Financial projections are based on estimated production volumes, product prices and expenses, including raw material cost, wages, energy and other expenses. Other significant assumptions include terminal value cash flow and growth rates, future capital expenditures and changes in future working capital requirements. The market approach is based on the observed ratios of enterprise value to earnings before interest, taxes, depreciation and amortization (EBITDA) of comparable, publicly traded companies. The market approach fair value is determined by multiplying historical and anticipated financial metrics of the European reporting unit by the EBITDA pricing multiples derived from comparable, publicly traded companies.

~~and market approaches, 75 percent and 25 percent, respectively.~~ Significant assumptions used under the income approach included a weighted average cost of capital (WACC) of 12.0 percent and a long-term growth rate of 1.5 percent, as compared to 10.0 percent and 2.0 percent, respectively, used in the 2019 assessment. In determining the WACC, management considered the level of risk inherent in the cash flow projections and current market conditions, including the significant increase in credit spreads and systemic market and Company specific risk premiums. The decline in the fair value under the market approach is attributable to the decline in the average EBITDA market multiple (4.9X EBITDA in 2020, 5.7X EBITDA in 2019) and lower forecasted EBITDA, as compared to the 2019 assessment. The use of these unobservable inputs results in classification of the fair value estimate as a Level 3 measurement in the fair value hierarchy. A considerable amount of management judgment and assumptions are required in performing the quantitative impairment test, principally related to determining the fair value of the reporting unit. While the Company believes its judgments and assumptions are reasonable, different assumptions could change the estimated fair value.

Following is a summary of the Company’s finite-lived and indefinite-lived intangible assets and goodwill as of ~~September~~June 30, ~~2020~~2021 and December 31, ~~2019.~~2020.

Amortization expense for these intangible assets was ~~$6.5~~$6.7 million and ~~$6.6~~$6.1 million for the three months ended ~~September~~June 30, ~~2020~~2021 and ~~2019,~~2020, respectively. Amortization expense for the ~~nine~~six months ~~ending September~~ended June 30, 2021 and 2020 ~~and 2019~~ was ~~$18.8~~$13.4 million and ~~$20.1~~$12.2 million, respectively. The anticipated annual amortization expense for these intangible assets is ~~$24.5~~$26.5 million for ~~2020 to~~ 2021, ~~$21.7~~$23.5 million for 2022 and ~~$19.8~~$21.4 million for 2023 and ~~2024.~~2024 and $10.5 million for 2025.

A summary of long-term debt and the related weighted average interest rates is shown below:

On June 15, 2017, the Company issued €250.0 million aggregate principal amount of 6.00 percent Senior Notes (“Notes”) due June 15, 2025. Interest on the Notes is payable semiannually, on June 15 and December 15. The Company may redeem the Notes, in whole or in part, on or after June 15, ~~2020~~2021 at a redemption ~~prices~~price of ~~103.0~~101.5 percent and ~~101.5 percent of the principal amount thereof, if the redemption occurs during the 12-month period beginning~~on or after June 15, ~~2020 or June 15, 2021, respectively, and~~2022 at a redemption price of 100 percent, ~~of the principal amount thereof on or after June 15, 2022,~~ in each case plus any accrued and unpaid interest ~~to, but not including,~~as of the applicable redemption date. If we experience a change of control or sell certain assets, the Company may be required to offer to purchase the Notes from the holders. The Notes are senior unsecured obligations ranking equally in right of payment with all of its existing and future senior indebtedness and senior in right of payment to any subordinated indebtedness. The Notes are effectively subordinated in right of payment to the existing and future secured indebtedness of the Company, including the Senior Secured Credit Facilities (as defined below), to the extent of the assets securing such indebtedness.

During the second and third quarters of 2019, the Company opportunistically purchased Notes on the open market with face values of $22.4 million (20.0 million Euro) and $7.8 million (7.0 million Euro) for $19.4 million $6.6 million, respectively. The carrying values associated with the Note purchases in the second and third quarters of 2019, net of allocable debt issuance costs, were $21.8 million and $7.6 million, respectively, resulting in gains of $2.4 million and $1.0 million, respectively, which were included in other income. During the fourth quarter of 2019, the Company purchased additional Notes on the open market with a face value of $6.6 million (6.0 million Euro) for $6.3 million. The associated carrying value of the Notes, net of allocable debt issuance costs, was $6.5 million, resulting in a net gain of $0.3 million for the fourth quarter, which was included in other income.

The Notes are unconditionally guaranteed by all material wholly-owned direct and indirect domestic restricted subsidiaries of the Company (the “Subsidiary Guarantors”), with customary exceptions including, among other things, where providing such guarantees is not permitted by law, regulation or contract, or would result in adverse tax consequences.

Subject to certain exceptions, the indenture governing the Notes contains restrictive covenants that, among other things, limit the ability of the Company and the Subsidiary Guarantors to: (i) incur additional indebtedness or issue certain preferred stock; (ii) pay dividends on, or make distributions in respect of, their capital stock; (iii) make certain investments or other restricted payments; (iv) sell certain assets or issue capital stock of restricted subsidiaries; (v) create liens; (vi) merge, consolidate, transfer or dispose of substantially all of their assets; and (vii) engage in certain transactions with affiliates. These covenants are subject to several important limitations and exceptions that are described in the indenture.

The indenture provides for customary events of default that include, among other things (subject in certain cases to customary grace and cure periods): (i) nonpayment of principal, premium, if any, and interest, when due; (ii) failure for 60 days to comply with any obligations, covenants or agreements in the indenture after receipt of written notice from the Bank of New York Mellon, London Branch (“the Trustee”) or holders of at least 30 percent in principal amount of the then outstanding Notes of such failure (other than defaults referred to in the foregoing clause (i)); (iii) default under any mortgage, indenture or instrument for money borrowed by the Company or certain of its subsidiaries, (iv) a failure to pay certain judgments; and (iv) certain events of bankruptcy and insolvency. If an event of default occurs and is continuing, the ~~Bank of New York Mellon, London Branch (“the Trustee”)~~Trustee or holders of at least 30 percent in principal amount of the then outstanding Notes may declare the principal, premium, if any, and accrued and unpaid interest on all the Notes to be due and payable. These events of default are subject to several important qualifications, limitations and exceptions that are described in the indenture. As of ~~September~~June 30, ~~2020,~~2021, the Company was in compliance with all covenants under the indenture governing the Notes.

On March 22, 2017, the Company entered into a senior secured credit agreement (“Credit Agreement”) with ~~Citibank, N.A, as Administrative Agent, Collateral Agent~~certain banks and ~~Issuing Bank, JP Morgan Chase N.A., Royal Bank of Canada and Deutsche Bank A.G. New York Branch as Joint Lead Arrangers and Joint Book Runners, and the~~ other ~~lenders party thereto (collectively, the “Lenders”).~~lenders. The Credit Agreement consisted of a $400.0 million senior secured term loan facility (“Term Loan Facility”), which matures on May 23, 2024, and a $160.0 million revolving credit facility originally maturing on May 23, 2022 ~~(“Revolving~~(the “Revolving Credit Facility” ~~and,~~), together with the Term Loan Facility, the USD Senior Secured Credit Facilities (“USD SSCF”)). On May 3, 2021, the Company extended the term of the Revolving Credit Facility under its USD SSCF and reduced the commitment under the facility from $160.0 million to $132.5 million, with $25.0 million of the commitment maturing May 23, 2022 and the remaining $107.5 million maturing October 31, 2023. The extension was treated as a modification of the revolving credit facility and the related debt issuance costs have been recognized as a deferred charge in other non-current assets and are being amortized ratably over the remaining term of the extended facility.

Borrowings under the Term Loan Facility will bear interest at a rate equal to, at the Company’s option, either (a) LIBOR for the relevant interest period, adjusted for statutory requirements, subject to a floor of 0.00 percent per annum, plus an applicable rate of 4.00 percent or (b) a base rate, subject to a floor of 2.00 percent per annum, equal to the highest of (1) the rate of interest in effect as publicly announced by the administrative agent as its prime rate, (2) the federal funds rate plus 0.50 percent and (3) LIBOR for an interest period of one month plus 1.00 percent, in each case, plus an applicable rate of 3.00 percent.

Borrowings under the Revolving Credit Facility bear interest at a rate equal to, at the Company’s option, either (a) LIBOR for the relevant interest period, with a floor of 0.00 percent per annum, plus the applicable rate or (b) a base rate, with a floor of 0.00 percent, equal to the highest of (1) the rate of interest in effect as publicly announced by the administrative agent as its prime rate, (2) the federal funds effective rate plus 0.50 percent and (3) LIBOR for an interest period of one month plus 1.00 percent, in each case, plus the applicable rate. The applicable rates for borrowings under the Revolving Credit Facility ~~and commitment fees for unused commitments under the Revolving Credit Facility~~ are based upon the First Lien Net Leverage Ratio effective for the preceding quarter, with LIBOR applicable rates ranging between 3.50 percent and 3.00 percent, currently ~~3.50~~3.25 percent, and base rate applicable rates ranging between 2.50 percent and 2.00 percent, currently ~~2.50~~ ~~percent~~2.25 percent. Commitment fees for the unused commitment under the Revolving Credit Facility are also based upon the First Lien Net Leverage Ratio, effective for the preceding quarter, and ~~commitment fees~~range between 0.50 percent and 0.25 percent for the commitment maturing May 23, 2022, currently 0.375 percent, and between 0.625 percent and 0.375 percent for the remaining commitment maturing October 31, 2023, currently 0.50 percent. Commitment fees are included in interest expense.

As of ~~September~~June 30, ~~2020,~~2021, the Company had repaid $50.8 million under the Term Loan Facility resulting in a balance of $349.2 million. In addition, the Company had 0 borrowings outstanding under the Revolving Credit Facility, outstanding letters of credit of $4.8 million and available unused commitments under this facility of ~~$155.2~~$127.7 million as of ~~September~~June 30, ~~2020.~~2021.

Our obligations under the Credit Agreement are unconditionally guaranteed by the Subsidiary Guarantors, with customary exceptions including, among other things, where providing such guarantees is not permitted by law, regulation or contract or would result in adverse tax consequences. The guarantees of such obligations, will be secured, subject to permitted liens and other exceptions, by substantially all of our assets and the Subsidiary Guarantors’ assets, including but not limited to: (i) a perfected pledge of all of the capital stock issued by each of the Subsidiary Guarantors (subject to certain exceptions) and up to 65 percent of the capital stock issued by each direct wholly-owned foreign restricted subsidiary of the Company (subject to certain exceptions) and (ii) perfected security interests in and mortgages on substantially all tangible and intangible personal property and material fee-owned real property of the Company and the Subsidiary Guarantors (subject to certain exceptions and exclusions).

The Credit Agreement contains a number of restrictive covenants that, among other things, restrict, subject to certain exceptions, our ability to incur additional indebtedness and guarantee indebtedness, create or incur liens, engage in mergers or consolidations, sell, transfer or otherwise dispose of assets, make investments, acquisitions, loans or advances, pay dividends, distributions or other restricted payments, or repurchase our capital ~~stock,~~stock. The Credit Agreement also restricts our ability to prepay, redeem, or repurchase any subordinated indebtedness, enter into agreements which limit our ability to incur liens on our assets or that restrict the ability of restricted subsidiaries to pay dividends or make other restricted payments to us, and enter into certain transactions with our ~~affiliates,~~ affiliates. Solely~~and, solely~~ with respect to the Revolving Credit Facility, the Credit Agreement also requires a Total Net Leverage Ratio (calculated as defined in the Credit Agreement) of not more than 4.5 to 1.0 as of each fiscal ~~quarter-end when outstanding borrowings, together with undrawn letters of credit exceeding $20 million, under the Revolving Credit Facility exceed 35~~ quarter-end.~~percent~~ ~~of the $160 million commitment amount.~~

In addition, the Credit Agreement contains customary default provisions, representations and warranties and other covenants. The Credit Agreement also contains a provision permitting the Lenders to accelerate the repayment of all loans outstanding under the ~~Senior Secured Credit Facilities~~USD SSCF during an event of default. As of ~~September~~June 30, ~~2020,~~2021, the Company was in compliance with all covenants under the Credit Agreement.

In connection with the acquisition of ~~Uniwheels,~~UNIWHEELS AG, the Company assumed $70.7 million of outstanding debt. At ~~September~~June 30, ~~2020, $11.0~~2021, $8.7 million of the assumed debt remained ~~outstanding~~outstanding. This debt matures March 31, 2024 and is collateralized by financed equipment, guaranteed by Superior and bears interest at 2.2 percent. Covenants under the loan agreement include a default provision for non-payment, as well as a material adverse change default provision pursuant to which the lender could accelerate the loan maturity. As of June 30, 2021, the Company was in compliance with all covenants under the loan agreement.

During the second quarter of ~~2019,~~2021, the Company amended its European Revolving Credit Facility (“EUR SSCF”), ~~increasing the available borrowing limit from €30.0 million to €45.0 million and~~ extending the term to May 22, ~~2022. On January 31, 2020,~~2023 and increasing the ~~available borrowing limit of~~applicable margin and commitment fees, while maintaining the ~~EUR SSCF was increased from €45.0~~€60.0 million ~~to €60.0 million.~~commitment. All other terms of the EUR SSCF remained unchanged. At ~~September~~June 30, ~~2020,~~2021, the Company had 0 borrowings outstanding, outstanding letters of credit of $0.5 million (€~~0.4 million)~~0.4million) and available unused commitments under this facility of ~~$70.0~~$70.9 million (€59.6 million). The EUR SSCF bears interest at Euribor (with a floor of 0)0.00 percent) plus a margin (ranging from ~~1.55~~2.05 percent to ~~3.0~~3.50 percent based on the net debt leverage ratio of Superior Industries Europe AG and its wholly owned subsidiaries, collectively “Superior Europe AG”), currently ~~1.55~~2.05 percent. The annual commitment fee for unused commitments (ranging from ~~0.50~~0.625 percent to ~~1.05~~1.225 percent based on the net debt leverage ratio of Superior Europe AG), is currently ~~0.50~~0.625 percent per annum. In addition, a management fee is assessed equal to 0.07 percent of borrowings outstanding at each month end. The commitment ~~and management fees are both~~fee is included in interest expense. Superior Europe AG has pledged substantially all of its assets, including land and buildings, receivables, inventory, and other moveable assets (other than collateral associated with equipment loans) as collateral under the EUR SSCF.

The EUR SSCF is subject to a number of restrictive covenants that, among other things, restrict, subject to certain exceptions, the ability of Superior Europe AG to incur additional indebtedness and guarantee indebtedness, create or incur liens, engage in mergers or consolidations, sell, transfer or otherwise dispose of assets, make investments, acquisitions, loans or advances, pay dividends or distributions, or repurchase our capital stock, prepay, redeem, or repurchase any subordinated indebtedness, and enter into agreements which limit our ability to incur liens on our assets. In addition, the EUR SSCF includes an annual pay down provision requiring outstanding balances to be repaid but not reborrowed for a period of three business days and a material adverse change default provision pursuant to which the lender could accelerate the loan maturity. At ~~September~~June 30, ~~2020,~~2021, Superior Europe AG was in compliance with all covenants under the EUR SSCF.

The balance of ~~2019, the Company entered into new~~certain post-acquisition equipment ~~loan agreements totaling $13.4~~loans was $13.5 million ~~(€12.0 million) which~~as of June 30, 2021. The loans bear interest at ~~2.67~~2.3 percent, ~~and~~ mature on September 30, ~~2027. Interest~~2027 and require quarterly principal ~~repayments are due quarterly.~~and interest payments. The loans are secured with liens on the financed equipment and are subject to covenants that, among other things, include a material adverse change default provision pursuant to which the lender could accelerate the loan maturity, as well as a provision that restricts the ability of Superior Europe AG to reduce its ownership interest in Superior Industries Production Germany GmbH, its wholly-owned subsidiary and the borrower under the loan. ~~During~~The Company drew down €10.6 million on these equipment loans in the first quarter of 2020 and drew the ~~Company had drawn down on~~remaining €1.4 million in the ~~equipment loans and the balance outstanding at September 30, 2020 was $12.4 million (€10.6 million).~~first quarter of 2021. Quarterly installment payments of $0.5 million (€0.4 million) under the loan agreements ~~will begin~~began in ~~December~~June of ~~2020~~2021. At ~~September~~June 30, ~~2020,~~2021, the Company was in compliance with all covenants under the loans.

Debt maturities as of June 30, 2021, which are due in the next five years and thereafter, are as follows:

During 2017, we issued 150,000 shares of Series A (140,202 shares) and Series B (9,798 shares) Perpetual Convertible Preferred Stock, par value $0.01 per share ~~to TPG Growth III Sidewall, L.P. (“TPG”)~~ for ~~an aggregate purchase price of~~ $150.0 million. On August 30, 2017, the Series B shares were converted into Series A redeemable preferred stock, the “redeemable preferred stock,” after approval by our shareholders. The redeemable preferred stock has an initial stated value of $1,000 per share, par value of $0.01 per share and liquidation preference over common stock.

The redeemable preferred stock is convertible into shares of our common stock equal to the number of shares determined by dividing the sum of the stated value and any accrued and unpaid dividends by the conversion price of $28.162. The redeemable preferred stock

accrues dividends at a rate of 99.0 percent per annum, payable at our election either in-kind or in cash and is also entitled to participate in dividends on common stock in an amount equal to that which would have been due had the shares been converted into common stock.

We may mandate conversion of the redeemable preferred stock if the price of the common stock exceeds $84.49. ~~TPG~~The holder may redeem the shares upon the occurrence of any of the following events (referred to as a “redemption event”): a change in control, recapitalization, merger, sale of substantially all of the Company’s assets, liquidation or delisting of the Company’s common stock. In addition, ~~as originally issued, TPG~~the holder has the right, at its option, to unconditionally redeem the shares at any time after ~~May 23, 2024, subsequently extended to~~ September 14, ~~2025 (the “redemption date”).~~2025. We may, at our option, redeem in whole at any time all of the shares of redeemable preferred stock outstanding. At redemption by either party, the redemption value will be the greater of two times the initial face value ($150.0 million) and any accrued unpaid dividends or dividends paid-in-kind, currently $300.0 million, or the product of the number of common shares into which the redeemable preferred stock could be converted ~~(approximately 5.3~~(5.3 million shares currently) and the then current market price of the common stock. We have determined that the conversion option and the redemption option exercisable upon occurrence of a “redemption event” which are embedded in the redeemable preferred stock must be accounted for separately from the redeemable preferred stock as a derivative liability.

Since the redeemable preferred stock may be redeemed at the option of the holder, but is not mandatorily redeemable, the redeemable preferred stock has been classified as mezzanine equity and initially recognized at fair value of $150.0 million (the proceeds on the date of issuance) less issuance costs of $3.7 million ~~resulting in an initial value of $146.3 million. This amount was further reduced by~~and $10.9 million assigned to the embedded derivative liability at date of issuance, resulting in an ~~adjusted~~ initial value of $135.5 million.

The difference between the ~~adjusted initial value of $135.5 million and the~~ redemption value of ~~$300 million was~~the redeemable preferred stock and the carrying value (the “premium”) is being accreted over the~~seven-year~~ period from the date of issuance through ~~May 23, 2024 (the original date at which the holder had the unconditional right to redeem the shares, deemed to be the earliest likely redemption date)~~September 14, 2025 using the effective interest method. The accretion ~~to the carrying value of the redeemable preferred stock~~ is treated as a deemed dividend, recorded as a charge to retained earnings and deducted in computing earnings per share (analogous to the treatment for stated and participating dividends paid on the redeemable preferred stock).

On November 7, 2018, the Company filed a Certificate of Correction to the Certificate of Designations for the preferred stock, which became effective upon filing and corrected the redemption date to September 14, 2025. This resulted in a modification of the redeemable preferred stock. As a result of the modification, the carrying value of the redeemable preferred stock decreased $17.2 million (which was credited to retained earnings, treated as a deemed dividend and is added back to compute earnings per share) and the period for The cumulative premium accretion of the carrying value to the redemption value has been extended to September 14, 2025. The accretion has been adjusted to amortize the excess of the redemption value over the carrying value over the period through September 14, 2025. The accumulated accretion net of the modification adjustment as of ~~September~~June 30, 2021 and December 31, 2020 ~~is $39.1~~was $53.9 million and $43.9 million, respectively, resulting in an adjusted redeemable preferred stock ~~balance~~balances of ~~$174.6 million.~~$189.4 million and $179.4 million, respectively.

On May 30, 2017, the Company acquired 92.3 percent of the outstanding shares of ~~Uniwheels, Inc.~~UNIWHEELS AG. Subsequently, the Company commenced a delisting and associated tender offer for the remaining shares. On January 17, 2018, the Company entered into a Domination and Profit and Loss Transfer agreement (“DPLTA”) retroactively effective as of January 1, 2018 pursuant to which we offered to purchase the remaining outstanding shares at €62.18. This price may be subject to change based on appraisal proceedings initiated by the minority shareholders which have not yet been concluded. The Company must also pay an annual dividend of €3.23 as long as the DPLTA is in effect. For any shares tendered prior to the annual dividend payment, we must pay interest at a statutory rate, currently 4.12 percent, in place of the dividend. As a result non-controlling interests with a carrying value of $51.9 million were reclassified from stockholders’ equity to mezzanine equity as of January 1, 2018 because non-controlling interests with redemption rights (not within the Company’s control) are considered redeemable and must be classified outside shareholders’ equity. As a result of purchases pursuant to the tender offer and the DPLTA, the Company has increased its ownership to 99.9 percent as of ~~September~~June 30, ~~2020. In addition, the carrying value of the non-controlling interests must be adjusted to redemption value since they are currently redeemable.~~2021. The following table summarizes the European non-controlling redeemable equity activity through the period ended ~~September~~June 30, ~~2020 (in thousands):~~2021:

Basic earnings per share is computed by dividing net income (loss), after deducting preferred dividends and accretion and European non-controlling redeemable equity dividends, by the weighted average number of common shares outstanding. For purposes of calculating diluted earnings per share, the weighted average shares outstanding includes the dilutive effect of outstanding stock options and time and performance based restricted stock units under the treasury stock method. The redeemable preferred shares discussed in Note 10, “Redeemable Preferred Stock” have not been included in the diluted earnings per share because the ~~conversion~~inclusion of such shares on an as converted basis would be anti-dilutive for the three and ~~nine~~six months ended ~~September~~June 30, ~~2020~~2021 and ~~2019.~~2020.


	Three Months Ended						Nine Months Ended						Three Months Ended						Six Months Ended
	September 30, 2020			September 30, 2019			September 30, 2020			September 30, 2019			June 30, 2021			June 30, 2020			June 30, 2021			June 30, 2020
(Dollars in thousands, except per share amounts)
Basic Earnings Per Share:
Net income (loss)	$	11,146		$	(6,631	)	$	(222,154	)	$	2,589		$	1,695		$	(43,218	)	$	14,817		$	(233,300	)
Less: Redeemable preferred stock dividends and accretion		(8,056	)		(7,587	)		(23,811	)		(23,275	)		(8,422	)		(7,905	)		(16,712	)		(15,755	)
Less: European non-controlling redeemable equity dividend		(106	)		(113	)		(152	)		(496	)		(25	)		(26	)		(38	)		(46	)
Basic numerator	$	2,984		$	(14,331	)	$	(246,117	)	$	(21,182	)	$	(6,752	)	$	(51,149	)	$	(1,933	)	$	(249,101	)
Basic earnings (loss) per share	$	0.12		$	(0.57	)	$	(9.66	)	$	(0.84	)
Basic loss per share													$	(0.26	)	$	(2.00	)	$	(0.07	)	$	(9.81	)
Weighted average shares outstanding – Basic		25,592			25,127			25,466			25,089			25,974			25,562			25,841			25,403
Diluted Earnings Per Share:
Net income (loss)	$	11,146		$	(6,631	)	$	(222,154	)	$	2,589		$	1,695		$	(43,218	)	$	14,817		$	(233,300	)
Less: Redeemable preferred stock dividends and accretion		(8,056	)		(7,587	)		(23,811	)		(23,275	)		(8,422	)		(7,905	)		(16,712	)		(15,755	)
Less: European non-controlling redeemable equity dividend		(106	)		(113	)		(152	)		(496	)		(25	)		(26	)		(38	)		(46	)
Diluted numerator	$	2,984		$	(14,331	)	$	(246,117	)	$	(21,182	)	$	(6,752	)	$	(51,149	)	$	(1,933	)	$	(249,101	)
Diluted earnings (loss) per share	$	0.12		$	(0.57	)	$	(9.66	)	$	(0.84	)
Diluted loss per share													$	(0.26	)	$	(2.00	)	$	(0.07	)	$	(9.81	)
Weighted average shares outstanding – Basic		25,592			25,127			25,466			25,089			25,974			25,562			25,841			25,403
Dilutive effect of common share equivalents		118			—			—			—			—			—			—			—
Weighted average shares outstanding – Diluted		25,710			25,127			25,466			25,089			25,974			25,562			25,841			25,403

The estimated annual effective tax rate is forecasted quarterly using actual historical information and forward-looking estimates and applied to year-to-date ordinary income. The tax effects of unusual or infrequently occurring items, including changes in judgment about valuation allowances, settlements with taxing authorities and effects of changes in tax laws or rates, are reported in the interim period in which they occur.

The income tax ~~benefit~~provision for the three and ~~nine~~six months ended ~~September~~June 30, ~~2020,~~2021 was ~~$3.9~~$0.9 million and ~~$11.1~~$1.7 million, respectively, on pre-tax income of $2.6 million and $16.5 million, resulting in an effective income tax ~~rate~~rates of ~~(53.8)~~35.2 percent and ~~4.8~~10.4 percent, respectively.

The effective income tax rate for the three months ~~ending September~~ended June 30, 2021 differs from the statutory rate primarily due to U.S. valuation allowances and the mix of earnings among tax jurisdictions, partially offset by a favorable adjustment to a tax credit. The effective income tax rate for the six months ended June 30, 2021 differs from the statutory rate primarily due to a favorable adjustment to a tax credit and the reversal of an uncertain tax position, partially offset by the mix of earnings among tax jurisdictions and U.S. valuation allowances.

The income tax benefit for the three and six months ended June 30, 2020 ~~differs~~was $3.8 million and $7.2 million, respectively, on pre-tax losses of $47.0 million and $240.5 million, resulting in effective income tax rates of 8.0 percent and 3.0 percent, respectively. The effective income tax rate for the three months ended June 30, 2020 differed from the statutory rate primarily due to the mix of earnings among tax jurisdictions ~~and~~partially offset by the recognition of a valuation allowance on non-deductible interest.

The effective income tax rate for the ~~nine~~six months ~~ending September~~ended June 30, 2020 ~~differs from~~was lower than the statutory rate primarily due to the mix of earnings among tax jurisdictions and the impairment of goodwill for which there is no corresponding tax benefit, ~~the mix of earnings among tax jurisdictions, and recognition of a valuation allowance on non-deductible interest.~~

The income tax benefit and provision for the three and nine months ended September 30, 2019 was $4.8 and $7.7 million, resulting in an effective income tax rate of 41.9 percent and 75.0 percent, respectively. The effective tax rate was higher than the statutory rate primarily due to the United States taxation of foreign earnings under the Global Intangible Low-Tax Income (“GILTI”) provisions, andpartially offset by the recognition of a valuation allowance on non-deductible interest ~~partially offset by a benefit due to the mix of earnings among tax jurisdictions.~~

The Company determines whether an arrangement is or contains a lease at the inception of the arrangement. Operating leases are included in other non-current assets, accrued expenses and other non-current liabilities in our condensed consolidated balance sheets. Finance leases are included in property, plant and equipment, net, short-term debt and long-term debt (less current portion) in our condensed consolidated balance sheets.

Right-of-use (“ROU”) assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. ~~Operating~~Finance and operating lease ROU assets and liabilities are recognized at the commencement date based on the present value of the lease payments over the lease term. Since we generally do not have access to the interest rate implicit in the lease, the Company uses our incremental borrowing rate (for fully collateralized debt) at the inception of the lease in determining the present value of the lease payments. The implicit rate is, however, used where readily available. Lease expense under operating leases is recognized on a straight-line basis over the term of the lease. Certain of our leases contain both lease and non-lease components, which are accounted for separately.

The Company has operating and finance leases for office facilities, a data center and certain equipment. The remaining terms of our leases range from over one year to ~~just under nine~~eight years. Certain leases include options to extend the lease term for up to ten years, as well as options to terminate which have been excluded from the term of the lease since exercise of these options is not reasonably certain.

Lease expense and cash flow for the three and ~~nine~~six months ended ~~September~~June 30, ~~2020~~2021 and ~~2019~~2020 and operating and finance lease assets and liabilities, average lease term and average discount rate as of ~~September~~June 30, ~~2020~~2021 and December 31, ~~2019~~2020 are as follows:

	Three Months Ended						Nine Months Ended				Three Months Ended				Six Months Ended
	September 30, 2020			September 30, 2019			September 30, 2020		September 30, 2019		June 30, 2021		June 30, 2020		June 30, 2021			June 30, 2020
(Dollars in thousands)
Lease Expense
Finance lease expense:
Amortization of right-of-use assets	$	615		$	548		$	906	$	1,551	$	350	$	290	$	671		$	644
Interest on lease liabilities		43			34			63		65		23		20		45			42
Operating lease expense		1,699			846			2,534		2,560		791		835		1,648			1,680
Total lease expense	$	2,357		$	1,428		$	3,503	$	4,176	$	1,164	$	1,145	$	2,364		$	2,366

Cash Flow Components
Cash paid for amounts included in the measurement of lease liabilities:
Cash paid for amounts included in the measurement of lease liabilities
Operating cash outflows from finance leases	$	43		$	34		$	63	$	65	$	23	$	20	$	45		$	42
Operating cash outflows from operating leases		1,818			821			2,692		2,484		871		873		1,803			1,764
Financing cash outflows from finance leases		467			381			723		1,035		357		255		645			547
Right-of-use assets obtained in exchange for finance lease liabilities, net of terminations and disposals		180			1,292			252		1,803		79		72		835			220
Right-of-use assets obtained in exchange for operating lease liabilities, net of terminations and disposals		422			12			637		18,353		56		215		208			280


	September 30, 2020			December 31, 2019											June 30, 2021			December 31, 2020
(Dollars in thousands, except lease term and discount rate)
Balance Sheet Information
Operating leases:
Other non-current assets	$	14,087		$	15,201										$	12,245		$	13,598
Accrued liabilities	$	(2,926	)	$	(2,949	)									$	(2,613	)	$	(2,868	)
Other non-current liabilities		(12,120	)		(13,282	)										(10,257	)		(11,513	)
Total operating lease liabilities	$	(15,046	)	$	(16,231	)									$	(12,870	)	$	(14,381	)

Finance leases:
Property and equipment gross	$	5,299		$	4,821
Property, plant and equipment gross															$	6,938		$	5,735
Accumulated depreciation		(3,024	)		(2,118	)										(3,990	)		(3,319	)
Property and equipment, net	$	2,275		$	2,703
Property, plant and equipment, net															$	2,948		$	2,416
Current portion of long-term debt	$	(893	)	$	(1,023	)									$	(1,188	)	$	(1,113	)
Long-term debt		(1,793	)		(2,045	)
Long-term debt (less current portion)																(2,117	)		(2,275	)
Total finance lease liabilities	$	(2,686	)	$	(3,068	)									$	(3,305	)	$	(3,388	)

Lease Term and Discount Rates
Weighted-average remaining lease term - finance leases (years)		3.9			4.1											3.5			3.9
Weighted-average remaining lease term - operating leases (years)		6.1			6.4											5.4			6.1
Weighted-average discount rate - finance leases		3.0	%		2.9	%										2.8	%		3.0	%
Weighted-average discount rate - operating leases		3.8	%		3.9	%										3.7	%		3.8	%

Summarized future minimum payments under our leases as of ~~September~~June 30, ~~2020~~2021 are as follows:

We have an unfunded salary continuation plan covering certain directors, officers and other key members of management. Subject to certain vesting requirements, the plan provides for a benefit based on final average compensation, which becomes payable on the employee’s death or upon attaining age 65, if retired. The plan was closed to new participants effective February 3, 2011.

For the ~~nine~~six months ended ~~September~~June 30, ~~2020,~~2021, payments to retirees or their beneficiaries totaled approximately ~~$1.1~~$0.7 million. We presently anticipate benefit payments in ~~2020~~2021 to total approximately ~~$1.3~~$1.4 million. The following table summarizes the components of net periodic pension cost for the three and ~~nine~~six months ended ~~September~~June 30, ~~2020~~2021 and ~~2019.~~2020.

Our 2018 Equity Incentive Plan (the “Plan”) was approved by stockholders in May ~~2018. The Plan authorizes~~2018, authorizing us to issue up to 4.35 million shares of common stock, along with non-qualified stock options, stock appreciation rights, restricted stock and performance units to our officers, key employees, non-employee directors and consultants. In May 2021, the stockholders approved an amendment to the Plan that, among other things, increased the authorized shares by 2 million. At ~~September~~June 30, ~~2020,~~2021, there were ~~0.6~~1.3 million shares available for future grants under this Plan. ~~No more than 1.2 million shares may be used under the Plan as “full value” awards, which include restricted stock and performance units.~~ It is our policy to issue shares from authorized but not issued shares upon the exercise of stock options.

Under the terms of the Plan, each year eligible participants are granted time value restricted stock units (“RSUs”), vesting ratably over a three-year period, and performance restricted stock units (“PSUs”), with three-year cliff vesting. Upon vesting, each restricted stock award is exchangeable for one share of the Company’s common stock, with accrued dividends.

On May 16, 2019 the Company granted the following equity awards to our then new President and Chief Executive Officer in connection with the 2019 Inducement Grant Plan (the “Inducement Plan”): (i) an initial award consisting of (a) 666,667 PSUs at target, vesting in three approximately equal installments, to the extent the performance metrics are satisfied, during each of three performance periods and (b) 333,333 RSUs, vesting in approximately equal installments on February 28, 2020, 2021 and 2022; (ii) a 2019-2021 PSU grant, with the target number of 316,832 PSUs, which will vest to the extent the performance metrics are satisfied; and (iii) a 2019 RSU grant of 158,416 RSUs, vesting in approximately equal installments on February 28, 2020, 2021 and 2022. The PSU awards may be earned at up to 200 percent of target depending on the level of achievement of the performance metrics.

Restricted stock unit and restricted performance stock unit activity for the ~~nine~~six months ended ~~September~~June 30, ~~2020~~2021 is summarized in the following table:

	Equity Incentive Awards															Equity Incentive Awards
	Restricted Stock Units			Weighted Average Grant Date Fair Value		Performance Shares			Weighted Average Grant Date Fair Value		Options			Weighted Average Exercise Price		Restricted Stock Units			Weighted Average Grant Date Fair Value		Performance Shares			Weighted Average Grant Date Fair Value		Options			Weighted Average Exercise Price
Balance at December 31, 2019		1,047,256		$	5.39		1,548,793		$	7.17		50,250		$	18.86
Balance at December 31, 2020																	1,213,667		$	3.59		2,176,290		$	4.88		24,000		$	20.39
Granted		634,317			2.87		948,636			3.25		—			—		411,291			5.94		653,438			8.41		—			—
Settled		(401,723	)		6.14		(245,713	)		5.05		—			—		(548,504	)		3.37		(193,778	)		5.45		—			—
Forfeited or expired		(195,540	)		4.27		(334,141	)		7.44		(26,250	)		17.46		(32,525	)		8.13		(151,369	)		12.61		(15,000	)		22.57
Balance at September 30, 2020		1,084,310		$	3.84		1,917,575		$	5.28		24,000		$	20.39
Balance at June 30, 2021																	1,043,929		$	4.49		2,484,581		$	6.67		9,000		$	16.76

Vested or expected to vest at September 30, 2020		981,873		$	3.82		323,862		$	7.79		24,000		$	20.39
Awards estimated to vest in the future																	987,615		$	4.55		2,200,512		$	6.78		9,000		$	16.76

Stock-based compensation expense ~~was $0.5 million and $1.8 million~~ for the three months ended ~~September~~June 30, 2021 and 2020 was $2.5 million and ~~2019,~~$0.9 million, respectively. Stock-based compensation for the six months ended June 30, 2021 and 2020 was $4.3 million and $0.7 million, respectively. The higher expense for the three and six months ended June 30, 2021 was primarily attributable to the modification of the 2019 and 2020 PSU awards, substituting budgeted amounts for actual performance for the second quarter of 2020 (one of twelve quarters in the respective performance periods), to offset the impact of COVID-19. This increased stock-based compensation for the three and six months ended June 30, 2021 by $1.2 million and ~~$3.7~~$2.3 million, ~~for the nine months ended September 30,~~respectively. In addition, 2020 ~~and 2019, respectively. The~~stock-based compensation was lower ~~expense in 2020 (for the three months and nine months ended September 30, 2020) was primarily~~ due to the ~~reduction~~first quarter 2020 reversal of ~~our estimates regarding the~~$1.2 million of previously accrued expense as a result of lower expected performance achievement, ~~of the performance metric, to 0,~~ in light of the global pandemic. Unrecognized stock-based compensation expense related to non-vested awards of ~~$3.7~~$15.2 million is expected to be recognized over a weighted average period of approximately ~~1.6~~1.9 years as of ~~September~~June 30, ~~2020.~~2021.

When market conditions warrant, we may enter into purchase commitments to secure the supply of certain commodities used in the manufacture of our products, such as aluminum, natural gas and other raw materials. Prices under our aluminum contracts are based on a market index, the London Mercantile Exchange, and regional premiums for processing, transportation and alloy components which are adjusted quarterly for purchases in the ensuing quarter. ~~Changes in aluminum prices are generally passed through to our OEM customers and adjusted on a quarterly basis.~~ Certain of our purchase agreements include volume commitments; however, any excess commitments are generally negotiated with suppliers and those which have occurred in the past have been carried over to future periods.

The Company sells certain customer trade receivables on a non-recourse basis under factoring arrangements with designated financial institutions. These transactions are accounted for as sales and cash proceeds are included in cash provided by operating activities. Factoring arrangements incorporate customary representations and warranties, including representations as to validity of amounts due, completeness of performance obligations and absence of commercial disputes. During the three months ended ~~September~~June 30, ~~2020~~2021 and ~~2019,~~2020, the Company sold trade receivables totaling ~~$169.8~~$197.3 million and ~~$80.6~~$67.7 million, respectively, and incurred factoring fees of ~~$0.4~~$0.5 million and $0.2 million, respectively. During the ~~nine~~six months ended ~~September~~June 30, ~~2020~~2021 and ~~2019,~~2020, the Company sold trade receivables totaling ~~$307.4~~$384.0 million and ~~$272.4~~$137.6 million, respectively, and incurred factoring fees of ~~$0.8~~$1.0 million and ~~$0.8~~$0.4 million, respectively. As of ~~September~~June 30, ~~2020~~2021 and December 31, ~~2019, $101.4~~2020, receivables of $100.1 million and ~~$49.6~~$96.6 million, respectively, ~~of receivables~~ had been factored ~~under~~and had not yet been paid by customers to the ~~arrangements.~~respective financial institutions. The collective limit under our factoring arrangements as of ~~September~~June 30, ~~2020~~2021 was ~~$115.9~~$129.0 million. ~~The limit has decreased to $105.9 million as of October 15, 2020 due to a $10 million decrease in North American factoring limit.~~ The collective limit under our factoring arrangements as of December 31, ~~2019~~2020 was ~~$117.3~~$132.0 million.

During the quarter ended June 30, 2020, the Company ~~discontinued~~decided to discontinue the manufacture and sale of high performance aftermarket wheels for the automotive racing market segment. The Company incurred a total non-cash charge of $3.4 million, including $2.8 million recorded in cost of sales, comprised of $1.3 million relating to write-downs of certain after-market inventory to salvage value, $1.0 million of employee severance costs and $0.5 million in contract terminations and other costs, as well as a $0.6 million non-cash charge recorded in selling, general and administrative expense related to non-production employee severance costs. ~~During~~In addition, during the ~~three-month~~six-month period ended ~~September 30,~~December 31, 2020, we recognized an additional ~~$0.4~~$0.7 million of severance ~~costs.~~costs, including charges to costs of sales of $0.4 million and selling, general and administrative expense of $0.3 million. As of ~~September~~June 30, ~~2020, $1.5~~2021, $0.1 million of the restructuring severance accrual remains.

During the third quarter of 2019, the Company initiated a plan to significantly reduce production and manufacturing operations at its Fayetteville, Arkansas location. As a result, the Company recognized a non-cash charge of $13.0 million in cost of sales, principally comprised ~~of (1) $7.6 million~~ of accelerated depreciation for excess equipment ~~(2) $3.2 million relating to~~and the write-down of certain supplies inventory to net salvage ~~value, (3) $1.6 million of employee severance and (4) $0.6 million of accelerated amortization of right of use assets under operating leases.~~value. In addition, relocation costs for redeployment of machinery and equipment of $1.8 million were recognized in the fourth quarter of 2019. During ~~the nine months ended September 30,~~ 2020, we recognized additional charges to cost of sales of $3.3 million, principally related to relocation costs for redeployment of machinery and equipment. During the three and six months ended June 30, 2021, we recognized additional relocation costs in cost of sales for redeployment of machinery and equipment of ~~$2.3~~$0.7 million and ~~additional other costs of $0.4 million. Additional relocation costs are expected to be incurred over the next three months.~~$1.5 million, respectively. As of ~~September~~June 30, ~~2020, $0.3~~2021, $0.2 million of the restructuring severance accrual remains. On July 15, 2021, the Company consummated the sale of the Fayetteville facility for a net sale price of $7.6 million, including $0.5 million which was deposited to escrow pending satisfactory completion of certain site repairs and remediation. The net sale price will be more than sufficient to recover the carrying value of the facility and the resulting gain will be recognized upon closing and classified as a part of selling, general and administrative expenses.

Production at our Werdohl Germany manufacturing site was temporarily halted due to flooding at the plant on July 14, 2021. On July 16^th, operations at this facility were restarted, with the exception of a painting line and certain machining cells. We have property and business interruption insurance coverage, each with a deductible of $2.5 million. We are in the process of determining the ultimate cost associated with this event.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements made by us or on our behalf. We have included or incorporated by reference in this Quarterly Report on Form 10-Q (including in the ~~sections~~section entitled ~~“Risk Factors” and~~ “Management’s Discussion and Analysis of Financial Condition and Results of Operations”) and from time to time our management may make statements that may constitute “forward-looking statements” within the meaning of Section 27A of the Securities Exchange Act of 1933 and Section 21E of the Securities Act of 1934. These forward-looking statements are based upon management’s current expectations, estimates, assumptions and beliefs concerning future events and conditions and may discuss, among other things, the impact of COVID-19 on our future business, results, operation and prospects, anticipated future performance (including sales and earnings), expected growth, future business plans and costs and potential liability for environmental-related matters. Any statement that is not historical in nature is a forward-looking statement and may be identified using words and phrases such as ~~“expects,” “anticipates,” “believes,” “will,”~~“expects”, “anticipates”, “believes”, “will”, “will likely ~~result,”~~result”, “will ~~continue,”~~continue”, “plans to” and similar expressions. These statements include our belief regarding general automotive industry and market conditions and growth rates, as well as general domestic and international economic conditions.

Readers are cautioned not to place undue reliance on forward-looking statements. Forward-looking statements are necessarily subject to risks, uncertainties and other factors, many of which are outside the control of the ~~company,~~Company, which could cause actual results to differ materially from such statements and from the ~~company’s~~Company’s historical results and experience. These risks, uncertainties and other factors include, but are not limited to, those described in Part I—Item 1A—“Risk Factors” and Part II—Item 7—“Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, ~~2019, Part II —Item 1A—“Risk Factors” of our Quarterly Report on Form 10-Q for the quarters ended March 31, 2020 and June 30,~~ 2020 and Part I—Item 2—“Management’s Discussion and Analysis of Financial Condition and Results of Operations” ~~as well as Part II—Item 1A—“Risk Factors” of this Quarterly Report on Form 10-Q~~ and elsewhere in ~~the~~this Quarterly Report and those described from time to time in our other reports filed with the Securities and Exchange Commission.

Readers are cautioned that it is not possible to predict or identify all the risks, uncertainties and other factors that may affect future results and that the risks described herein should not be considered to be a complete list. Any forward-looking statement speaks only as of the date on which such statement is made, and the ~~company~~Company undertakes no obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

Management’s Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with the accompanying unaudited condensed consolidated financial statements and notes thereto and with the audited consolidated financial statements and notes thereto and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the year ended December 31, ~~2019.~~2020.

Superior Industries International, Inc.’s (referred herein as the ~~“Company,” “Superior,”~~“Company”, “Superior”, or “we” and “our”) principal business is the design and manufacture of aluminum wheels for sale to original equipment manufacturers ~~(OEMs)~~(“OEMs”) in North America and Europe and to the aftermarket ~~distributors~~ in Europe. We employ approximately ~~7,500~~7,700 full-time employees, operating in eight manufacturing facilities in North America and ~~Europe with a combined annual manufacturing capacity of approximately 20 million wheels.~~Europe. We are one of the largest aluminum wheel suppliers to global OEMs and we believe we are the #1 European aluminum wheel aftermarket manufacturer and supplier. Our OEM aluminum wheels accounted for approximately 92 percent of our sales in the first ~~nine~~six months of ~~2020~~2021 and are primarily sold for factory installation on vehicle models manufactured by BMW (including Mini), Daimler AG Company (Mercedes-Benz, AMG, Smart), ~~FCA,~~ Ford, GM, Honda, Jaguar-Land Rover, Lucid Motors, Mazda, ~~Mitsubishi,~~ Nissan, PSA, Renault, Stellantis, Subaru, Suzuki, Toyota, VW Group (Volkswagen, Audi, SEAT, Skoda, Porsche, Bentley) and Volvo. We also sell aluminum wheels to the European aftermarket under the brands ATS, RIAL, ALUTEC and ANZIO. North America and Europe represent the principal markets for our products, but we have a diversified global ~~presence and diversified~~ customer base consisting of North American, European and Asian OEMs. ~~We continue to deliver on our strategic plan to be one of the leading light vehicle aluminum wheel suppliers globally, delivering innovative wheel solutions to our customers.~~

~~Our global reach encompasses sales to the ten largest OEMs in the world. The following chart shows our sales by customer for the nine months ended September 30, 2020 and 2019.~~

Demand for our products is primarily driven by the production of light vehicles in North America and Europe and customer take rates on specific vehicle platforms that we serve and wheel SKUs that we produce. The majority of our customers’ wheel programs are awarded two to four years in advance. Our purchase orders with OEMs are typically specific to a particular vehicle model.

GM, VW Group and Ford were our only customers individually accounting for 10 percent or more of our consolidated sales for the three and six months ended June 30, 2021 and 2020. Our sales to these customers in 2021 and 2020 were as follows:

~~During the nine months ended September 30,~~In 2020, the ~~impact of the~~ COVID-19 ~~pandemic and uncertainty with respect to the economic effects of the~~ pandemic introduced significant volatility in the financial markets and ~~continues to have~~had a widespread adverse effect on the automotive ~~industry, including reductions in consumer demand and OEM automotive production.~~industry.

While navigating through this period of volatility and uncertainty, Superior’s top priorities ~~continue to be:~~were:

~~Consistent with these priorities,~~In order to ensure the health and safety of our employees globally and respond to the then current industry production environment, we closed production at our European facilities in late March 2020. In North America, our manufacturing operations ceased production in early April 2020. The Company reopened all of its facilities by June 1, 2020, in line with ~~production~~industry demand and finished goods levels, and in accordance with local government requirements.

To ensure the health and safety of its employees, Superior has developed and is executing a Safe Work Playbook across its footprint in connection with our employees’ return to work. We have also instituted a Global Employee Health & Safety (“EH&S”) Steering Team, led by our Director of EH&S, and comprised of our global and regional leaders from Operations and Human Resources. We have invested in facility updates to ensure social distancing, including changes in cafeteria layout and practices, transportation services and marked spacing throughout our manufacturing facilities. In the event of a COVID-19 incident, the local COVID-19 response team immediately executes the defined protocols, including isolation of any employee showing symptoms, and conducts traceability activities to identify and quarantine all potentially exposed individuals. Since resuming operations, the Company has identified 76 employees with COVID-19 infections, 61 of whom have returned to work and the rest are currently in quarantine. We do not believe that any of these cases arose from work related exposure based on the Company’s contact tracing procedures.

As a result, ~~of the~~ COVID-19 ~~pandemic, our global units shipped for the nine months ended September 30, 2020 declined approximately 27.4~~ ~~percent~~ ~~as compared to the nine months ended September 30, 2019. The decline began to moderate during the month of June, with units shipped declining only 12.5~~ ~~percent~~ ~~in June as industry production volumes started to recover. The rates of decline continued to decrease during the third quarter of 2020. Our units shipped reflected~~had a ~~decline of 10.1~~ ~~percent~~ ~~in the third quarter of 2020 as compared to the third quarter of 2019, with North America shipments declining 4.5~~ ~~percent~~ ~~and European shipments declining 16.0~~ ~~percent~~ ~~year-over-year. Our volumes were down only 2.1~~ ~~percent~~ ~~globally for September of 2020 on a year-over-year basis. The decline was due to the 5.6~~ ~~percent~~ volume decline in Europe offset by a slight increase in units shipped in North America in September 2020 as compared to September 2019. As such, our North American operations’ recovery from COVID-19 has been strong, while the European operations’ recovery has been slower (refer to the discussion under Results of Operations for further details on year-over-year comparisons and the impact of COVID-19significant adverse effect on our ~~results).~~

While Superior experienced stronger demand from its customers during the third quarter as compared to the second quarter, the Company continued to extend cost reduction initiatives to align costs to the lower production environment. During the nine months ended September 30,business, results of operations and financial condition in 2020, Superior has executed temporary and permanent cost savings including furloughs, compensation and benefit reductions, temporary facility closures, deferral of merit increases, reduced travel, personnel restructurings, and use of government subsidies where available. While some of the temporary measures such as the wage reductions were discontinued in the third quarter as Superior restored its salaried workforce to full pay in mid-September, other temporary initiatives will remain in place throughbut this effect had largely subsided by the end of the ~~year and into 2021. In total, the cost initiatives implemented in response to the COVID-19 pandemic are expected to benefit 2020 by more than $40 million.~~ year.

Based on recent IHS production forecasts, full-year ~~2020~~2021 industry volumes are ~~now~~ expected to be ~~down approximately 22.1~~up 10.6 percent in our key regions ~~20.3~~(12.3 percent in North America and ~~23.7~~8.9 percent in Western and Central Europe,) as compared to ~~the prior year~~2020, but 13.8 percent lower than 2019 (down 10.4 percent in North America and 16.9 percent in Europe). This represents a 3.2 percent improvement globally compared to the IHS forecast as of the end of the second quarter. The ultimate impact that COVID-19 will have on our business, results of operations and financial condition will depend on a number of evolving factors that we may not be able to accurately predict, including: the duration and scope of the pandemic; governmental, OEMs’, suppliers’, customers’ and individuals’ actions that have been and continue to be taken in response to the pandemic; and the impact of the pandemic on economic activity and actions that continue to be taken in response to such impact by the OEMs’ suppliers and customers. We are continuing to monitor the recent resurgence of the virus, including the emergence of new virus strains, in certain U.S. states and countries in which we operate, the progress of the vaccination deployment and supply chain shortages affecting the automotive industry (including semiconductors, electric vehicle batteries, shipping containers, steel, resin and foam), as well as the impact of these developments on OEM ~~customer~~ production plans for the ~~remainder~~year.

All Superior manufacturing plants have implemented Environmental Management Systems that are ISO14001 certified and are subject to annual audits by an independent third party. In 2019, we assessed the product carbon footprint of ~~the year, as volumes~~our European operations for the ~~fourth quarter remain somewhat uncertain and are dependent upon the progress in containing the pandemic and associated impact~~first time based on the ~~economy.~~Greenhouse Gas Protocol, and we assessed the carbon footprint for our operations globally in connection with our UN Global Compact Sustainability Report published in June 2021. These assessments can help us identify potential opportunities to reduce fuel consumption and greenhouse gas emissions. In this regard, our research and development team is focused on developing automotive light weighting solutions such as our patented Alulite™ technology which will assist in reducing our customers’ carbon footprint. Superior is committed to reducing natural gas, electricity and water consumption and solid waste and air emissions at all of our facilities globally. We are also collaborating with our suppliers regarding sustainability practices throughout their supply chains.

The following charts show the operational performance in the quarter ended ~~September~~June 30, ~~2020~~2021 in comparison to the quarter ended ~~September~~June 30, ~~2019~~2020 ($ in millions):

SALES AND PROFITABILITY FOR THE 3RD QUARTER OF 2019 AND 2018 ($ in millions) Sales for 3rd Quarter 2019 & 2018 $352.0 $347.6 2019 2019 Income from Operations 3rd Quarter 2019 & 2018$(0.2) $7.7 2019 218 Net Income & Adjusted EBITDA* for 3rd Quarter 2019 & 2018 Net Income Adjusted EBITDA $38.9 $30.6 $(6.6) 2019 2018 * See the Non-GAAP Financial Measures section of this quarterly report for a reconciliation of our Adjusted EBITDA to Net Income (Loss).

	Three Months Ended									Three Months Ended
	September 30, 2020			September 30, 2019			Net Change			June 30, 2021			June 30, 2020			Net Change
(Dollars in thousands, except per share data)
Net sales
North America	$	166,662		$	188,089		$	(21,427	)	$	176,990		$	58,916		$	118,074
Europe		150,441			163,925			(13,484	)		170,474			85,919			84,555
Net sales		317,103			352,014			(34,911	)		347,464			144,835			202,629
Cost of sales		285,135			335,967			50,832			314,844			167,676			(147,168	)
Gross profit		31,968			16,047			15,921
Gross profit (loss)											32,620			(22,841	)		55,461
Percentage of net sales		10.1	%		4.6	%		5.5	%		9.4	%		(15.8	)%		25.2	%
Selling, general and administrative		12,730			16,290			3,560			17,100			11,276			(5,824	)
Income (loss) from operations		19,238			(243	)		19,481			15,520			(34,117	)		49,637
Percentage of net sales		6.1	%		(0.1	)%		6.2	%		4.5	%		(23.6	)%		28.1	%
Interest expense, net		(10,414	)		(11,807	)		1,393			(10,486	)		(12,184	)		1,698
Other (expense) income, net		(1,576	)		634			(2,210	)
Income tax benefit		3,898			4,785			(887	)
Other expense, net											(2,420	)		(670	)		(1,750	)
Income tax (provision) benefit											(919	)		3,753			(4,672	)
Net income (loss)	$	11,146		$	(6,631	)	$	17,777		$	1,695		$	(43,218	)	$	44,913
Percentage of net sales		3.5	%		(1.9	)%		5.4	%		0.5	%		(29.8	)%		30.3	%
Diluted earnings (loss) per share	$	0.12		$	(0.57	)	$	0.69
Diluted loss per share										$	(0.26	)	$	(2.00	)	$	1.74
Value added sales (1)	$	192,469		$	195,451		$	(2,982	)	$	195,474		$	84,284		$	111,190
Adjusted EBITDA (2)	$	46,723		$	38,852		$	7,871		$	44,645		$	(3,696	)	$	48,341
Percentage of net sales		14.7	%		11.0	%		3.7	%		12.8	%		(2.6	)%		15.4	%
Percentage of value added sales		24.3	%		19.9	%		4.4	%		22.8	%		(4.4	)%		27.2	%
Unit shipments in thousands		4,362			4,851			(489	)		4,178			2,068			2,110

Wheel unit shipments were ~~4.4~~4.2 million for the ~~third~~second quarter of ~~2020~~2021 compared to unit shipments of ~~4.9~~2.1 million in the prior year period, ~~a decrease~~ an increase of ~~10.1~~102.0 percent. The ~~decrease~~increase was driven by ~~lower~~higher volumes ~~primarily with~~in both regions due to the 2020 shutdowns at our key ~~European~~ OEM ~~customers.~~

Net salesfor the ~~third~~second quarter of ~~2020~~2021 were ~~$317.1~~$347.5 million, compared to net sales of ~~$352.0~~$144.8 million for the same period in ~~2019.~~ 2020. The ~~decrease~~increase in the quarter was driven by ~~lower~~higher volumes ~~and a decrease~~ in ~~aluminum prices, partially offset by favorable~~both regions due to 2020 shutdowns at key OEM customers in response to the COVID-19 pandemic, stronger product mix in both North America and ~~a stronger Euro.~~

Cost of sales were ~~$285.1~~$314.8 million for the ~~third~~second quarter of ~~2020~~2021 compared to cost of sales of ~~$336.0~~$167.7 million for the same period in ~~2019.~~2020. The ~~decrease~~increase was principally driven by higher volumes in ~~cost of sales was primarily~~both regions due to ~~lower volumes in Europe and North America, lower aluminum prices,~~ reduced ~~headcount, the utilization of government subsidies in Europe, and the~~ prior ~~year rationalization of the Company’s~~period North American and European manufacturing ~~footprint.~~costs resulting from OEM customer and Superior production shutdowns in response to the COVID-19 pandemic.

Selling, general and administrative (“SG&A”) expenses for the ~~third~~second quarter of ~~2020~~2021 were ~~$12.7~~$17.1 million compared to SG&A expense of ~~$16.3~~$11.3 million for same period in ~~2019.~~2020. The increase in SG&A expenses ~~were lower~~is principally due to lower prior period compensation and benefit ~~and headcount reductions implemented due~~expense resulting from cost savings actions taken in response to the COVID-19 ~~pandemic.~~

Net interest expense for the ~~third~~second quarter of ~~2020~~2021 was ~~$10.4~~$10.5 million compared to net interest expense of ~~$11.8~~$12.2 million for same period in ~~2019.~~2020. The decrease was primarily due to ~~the early extinguishment of a portion of the 6% Senior Notes (the “Notes”) in 2019, additional principal repayments of the Term Loan Facility in 2019 and 2020 an~~d lower interest rates on the Term Loan ~~Facility. This was partially offset by incremental interest expense due to~~Facility in 2021 and elevated borrowings under our revolving lines of credit during the ~~Company’s drawings on our North American and European revolvers in 2020.~~

Other expense was ~~$1.6~~$2.4 million for the ~~third~~second quarter of ~~2020~~2021 compared to ~~other income of $0.6~~$0.7 million for the same period in ~~2019.~~ 2020. The ~~year-over-year change was~~current year expense is primarily ~~driven by a $1.0 million gain on early extinguishment of a portion of our Notes and a foreign exchange gain of $0.3 million~~attributable to an increase in the ~~third quarter of 2019 versus a foreign exchange loss of $1.4 million~~preferred stock embedded derivative liability due to the increase in the ~~third quarter of 2020.~~

The income tax ~~benefit~~provision for the second quarter ~~ended September 30, 2020~~of 2021 was ~~$3.9~~$0.9 million on a pre-tax income of ~~$7.2~~$2.6 million, representing an effective income tax rate of ~~negative 53.8~~35.2 percent. This differs from the statutory rate primarily due to U.S. valuation allowances and the mix of earnings among tax jurisdictions, partially offset by a favorable adjustment to a tax credit. The income tax benefit for the second quarter of 2020 was $3.8 million on a pre-tax loss of $47.0 million, representing an effective income tax rate of 8.0 percent. This was lower than the statutory rate primarily due to the mix of earnings among tax jurisdictions, ~~and~~partially offset by the recognition of a valuation allowance on non-deductible interest. The income tax benefit for the quarter ended September 30, 2019 was $4.8 million on a pre-tax loss of $11.4 million, representing an effective income tax rate of 41.9 percent. This was higher than the statutory rate due to the United States Global Intangible Low-Tax Income (“GILTI”) provisions and the recognition of a valuation allowance on non-deductible interest, offset by a mix of earnings among tax jurisdictions.

Net income for the ~~third~~second quarter of ~~2020~~2021 was ~~$11.1~~$1.7 million, or ~~earnings~~a loss of ~~$0.12~~$0.26 per diluted share, compared to a net loss of ~~$6.6~~$43.2 million, or a loss of ~~$0.57~~$2.00 per diluted share, for the same period in ~~2019.~~

Net sales for our North American segment for the ~~third~~second quarter of ~~2020 decreased 11.4~~2021 increased 200.4 percent, compared to the same period in ~~2019~~2020 predominantly due to a ~~4.5~~150.3 percent ~~decrease~~increase in unit volumes along with stronger product mix and ~~lower~~higher aluminum prices. ~~The reduction in net~~For the second quarter of 2021, North American sales ~~was partially offset by improved product mix comprised~~were almost exclusively from Mexico, which compares to U.S. sales of ~~larger diameter wheels and premium wheel finishes. U.S.~~6.1 percent and Mexico sales ~~as a percentage~~ of ~~North America total sales were approximately 3.1 percent and 96.9 percent, respectively, for the quarter ended September 30, 2020, which compares to 14.3 percent and 85.7~~93.9 percent for the same period of the prior year. The change in North American sales by country is due to discontinuation of manufacturing activities at our Fayetteville, Arkansas ~~location in the fourth quarter of 2019.~~location. North American segment income (loss) from operations for the ~~third~~second quarter of ~~2020~~2021 was higher than the same period of the prior year, principally due to ~~reduced headcount~~higher volumes and ~~operating expenses, reduced selling and general administrative expenses and the benefits from prior year rationalization of the Company’s~~improved manufacturing ~~footprint.~~ performance, as well as stronger product mix, partially offset by increased compensation expense.

Net sales for our European segment for the ~~third~~second quarter of ~~2020 decreased 8.2~~2021 increased 98.4 percent, compared to the same period in ~~2019,~~2020 predominantly due to a ~~16.0~~68.9 percent ~~decrease~~increase in unit volumes ~~and lower aluminum pricing partially offset by favorable~~along with stronger product mix and ~~Euro~~favorable foreign exchange. ~~The decline in unit shipments was mainly due to lower volumes for Superior’s key European OEM customers related to the on-going COVID-19 pandemic.~~ European segment sales in Germany and Poland were ~~approximately 38.8~~36.7 percent and ~~61.2~~63.3 percent, respectively, ~~during~~for the second quarter ~~ended September 30, 2020,~~of 2021, which compares to ~~36.3~~39.3 percent and ~~63.7~~60.7 percent for the same period of the prior year. European segment income from operations for the ~~third~~second quarter ~~in 2020 decreased compared to~~of 2021 was higher than the same period ~~in 2019~~of the prior year, principally due to ~~lower production~~higher volumes ~~for our key European OEM customers related to the on-going COVID-19 pandemic,~~and improved manufacturing performance, as well as stronger product mix and favorable foreign exchange, partially offset by ~~favorable product mix, the use of government labor subsidies and reduced manufacturing headcount.~~increased compensation expense.

The following chart shows the operational performance in the ~~nine~~six months ended ~~September~~June 30, ~~2020~~2021 in comparison to the ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020 ($ in millions):

	Nine Months Ended									Six Months Ended
	September 30, 2020			September 30, 2019			Net Change			June 30, 2021			June 30, 2020			Net Change
(Dollars in thousands, except per share data)
Net sales
North America	$	381,129		$	553,607		$	(172,478	)	$	368,961		$	214,467		$	154,494
Europe		381,921			508,599			(126,678	)		336,699			231,480			105,219
Net sales		763,050			1,062,206			(299,156	)		705,660			445,947			259,713
Cost of sales		730,762			973,042			(242,280	)		630,000			445,627			184,373
Gross profit		32,288			89,164			(56,876	)		75,660			320			75,340
Percentage of net sales		4.2	%		8.4	%		(4.2	)%		10.7	%		0.1	%		10.6	%
Selling, general and administrative		36,541			46,737			10,196			34,421			23,811			(10,610	)
Impairment of goodwill and indefinite-lived intangibles		193,641			—			(193,641	)		—			193,641			193,641
(Loss) income from operations		(197,894	)		42,427			(240,321	)
Income (loss) from operations											41,239			(217,132	)		258,371
Percentage of net sales		(25.9	)%		4.0	%		(29.9	)%		5.8	%		(48.7	)%		54.5	%
Interest expense, net		(34,448	)		(35,532	)		1,084			(20,759	)		(24,034	)		3,275
Other (expense) income, net		(923	)		3,393			(4,316	)		(3,934	)		653			(4,587	)
Income tax benefit (provision)		11,111			(7,699	)		18,810
Net (loss) income	$	(222,154	)	$	2,589		$	(224,743	)
Income tax (provision) benefit											(1,729	)		7,213			(8,942	)
Net income (loss)										$	14,817		$	(233,300	)	$	248,117
Percentage of net sales		(29.1	)%		0.2	%		(29.3	)%		2.1	%		(52.3	)%		54.4	%
Diluted loss per share	$	(9.66	)	$	(0.84	)	$	(8.82	)	$	(0.07	)	$	(9.81	)	$	9.74
Value added sales (1)	$	446,844		$	581,899		$	(135,055	)	$	402,733		$	254,375		$	148,358
Adjusted EBITDA (2)	$	82,557		$	131,282		$	(48,725	)	$	99,568		$	35,834		$	63,734
Percentage of net sales		10.8	%		12.4	%		(1.6	)%		14.1	%		8.0	%		6.1	%
Percentage of value added sales		18.5	%		22.6	%		(4.1	)%		24.7	%		14.1	%		10.6	%
Unit shipments in thousands		10,737			14,780			(4,043	)		8,693			6,375			2,318

Wheel unit shipments were ~~10.7~~8.7 million for the first ~~nine months~~half of ~~2020~~2021 compared to unit shipments of ~~14.8~~6.4 million in the prior year period, ~~a decrease~~an increase of ~~27.4~~36.4 percent. The ~~decrease occurred~~increase was attributable to higher volumes in ~~both our~~ North ~~American~~America and ~~European operations and was~~Europe primarily driven by ~~lower~~the 2020 production ~~volumes~~shutdowns at our key ~~North American and European~~ OEM customers ~~due~~in response to the ~~on-going~~ COVID-19 ~~pandemic, including production shut-downs in the second quarter of 2020.~~ pandemic.

Net salesfor the first ~~nine months~~half of ~~2020~~2021 were ~~$763.0~~$705.7 million, compared to net sales of ~~$1,062.2~~$445.9 million for the same period in ~~2019.~~2020. The ~~decrease~~increase in net sales was primarily driven by ~~lower~~higher production volumes in North America and Europe ~~related~~due to the ~~on-going~~2020 production shutdowns at our key OEM customers in response to the COVID-19, ~~pandemic and lower~~as well as favorable product mix, higher aluminum prices ~~partially offset by~~and favorable ~~product mix.~~Euro foreign exchange.

Cost of sales were ~~$730.8~~$630.0 million for the first ~~nine months~~half of ~~2020~~2021 compared to cost of sales of ~~$973.0~~$445.6 million for the same period in ~~2019.~~2020. The ~~decrease~~increase in cost of sales was primarily due to ~~lower~~significantly higher production volumes in North America and Europe ~~related~~driven by the 2020 production shutdowns at our key OEM customers in response to the ~~on-going~~ COVID-19, ~~pandemic, lower~~favorable mix, higher aluminum prices and ~~utility~~reduced prior period manufacturing costs ~~(due to both lower volumes and cost savings~~resulting from our ~~North American plant investments~~production shutdowns in ~~2019~~response to ~~use electricity from~~ the ~~secondary market), reduced headcount,~~onset of the ~~use~~pandemic in the latter part of ~~European government subsidies~~first quarter and the ~~reduced operating expense related to the prior year rationalization~~second quarter of ~~the Company’s North American manufacturing footprint.~~2020.

Selling, general and administrative (“SG&A”) expenses for the first ~~nine months~~half of ~~2020~~2021 were ~~$36.5~~$34.4 million, compared to SG&A expense of ~~$46.7~~$23.8 million for same period in ~~2019~~2020. The increase in SG&A expenses is due to ~~reduced~~lower prior period compensation and ~~benefits~~benefit expense resulting from cost savings actions taken in response to the COVID-19 OEM and Superior production shutdowns and increased compensation expense in the current period related to ~~COVID-19 cost savings programs and lower travel expenses.~~the return to a steady production environment with improved operating performance.

During the first ~~quarter~~half of 2020, we recognized a goodwill and indefinite-lived intangible asset impairment charge totaling $193.6 million relating to our European reporting unit (refer to Note 8, “Goodwill and Other Intangible Assets” in the notes to the condensed consolidated financial statements).

Net interest expense for the first ~~nine months~~half of ~~2020~~2021 was ~~$34.4~~$20.8 million compared to net interest expense of ~~$35.5~~$24.0 million for same period in ~~2019.~~2020. The decrease was primarily due to ~~early extinguishment of a portion of the Notes in 2019 and additional principal repayments of~~lower interest rates on the Term Loan Facility in ~~2019~~2021 and ~~2020,~~ ~~along with lower Term Loan interest rates. This was partially offset by~~elevated borrowings under our revolving lines of credit during the ~~incremental interest expenses due to the Company’s drawings on our North American and European revolvers in~~first half of 2020.

Other expense was ~~$0.9~~$3.9 million for the first ~~nine months~~half of ~~2020~~2021 compared to other income of ~~$3.4~~$0.7 million for same period in ~~2019.~~2020. The ~~decline~~2021 expense was primarily attributable to the increase in ~~other~~the preferred stock embedded derivative liability due to the increase in the Company’s stock price while the prior period income ~~in 2020~~ was primarily driven by ~~a $3.4 million gain on early extinguishment of a portion of the Notes recognized in 2019 and higher~~ foreign exchange ~~losses in 2020.~~gains.

The income tax ~~benefit~~provision for the ~~first nine~~six months ended June 30, 2021 was $1.7 million on a pre-tax income of $16.5 million, representing an effective rate of 10.4 percent. The effective income tax rate for the six months ended June 30, 2021 differs from the statutory rate primarily due to a favorable adjustment to a tax credit and the reversal of an uncertain tax position, partially offset by the mix of earnings among tax jurisdictions and U.S. valuation allowances. The income tax benefit for the six months ended June 30, 2020 was ~~$11.1~~$7.2 million on a pre-tax loss of ~~$233.3~~$240.5 million, representing an effective ~~income tax~~ rate of ~~4.8~~3.0 percent. This ~~differs from~~was lower than the statutory rate due to the mix of earnings among tax jurisdictions and the impairment of goodwill for which there is no corresponding tax benefit, partially offset by the ~~mix of earnings among tax jurisdictions, and~~ recognition of a valuation allowance on non-deductible interest. The income tax provision for the first nine months of 2019 was $7.7 million on pre-tax income of $10.3 million, representing an effective income tax rate of 75.0 percent. This was higher than the statutory rate due to the GILTI provisions and the recognition of a valuation allowance on non-deductible interest, offset by a benefit due to the mix of earnings among tax jurisdictions.

Net ~~loss~~income for the first ~~nine months~~half of ~~2020~~2021 was ~~$222.2~~$14.8 million, or a loss of ~~$9.66~~$0.07 per diluted share, compared to a net ~~income~~loss of ~~$2.6~~$233.3 million, or a loss of ~~$0.84~~$9.81 per diluted share, for the same period in ~~2019.~~

Net sales for our North American segment for the first ~~nine months~~half of ~~2020 decreased 31.2~~2021 increased 72.0 percent, compared to the same period in ~~2019,~~2020, due to a ~~28.4~~48.9 percent ~~decrease~~increase in volumes ~~which was primarily attributable~~related to ~~the on-going COVID-19 pandemic, including a~~our prior period Q2 production ~~shut-down within the second quarter of the year and lower aluminum prices, partially offset by improved~~shutdowns, stronger product mix comprised of larger diameter wheels and premium wheel ~~finishes.~~finishes and higher aluminum prices. For the first half of 2021, North American sales were almost exclusively shipped from Mexico, which compares to U.S. sales of 9.2 percent and Mexico sales ~~as a percentage~~ of ~~North America total sales were approximately 6.5 percent and 93.5 percent, respectively, for the first nine months of 2020, which compares to 14.7 percent and 85.3~~90.8 percent for the prior year period. The change in North American sales by country is due to ~~ending~~discontinuing manufacturing activities at our Fayetteville, Arkansas location in the fourth quarter of 2019. North American segment income from operations for the first ~~nine months~~half of 2020 was ~~lower~~higher than the prior year period, principally due to ~~reduced production~~higher volumes ~~at our key North American OEM customers primarily driven by the on-going COVID-19 pandemic, including a production shutdown within the second quarter,~~and improved manufacturing performance, as well as stronger product mix, partially offset by favorable product mix, utility cost savings associated with plant investments made in 2019 to use electricity from a competitively priced market and cost reductions including furloughs, hourly and salary wage and benefit reductions, the temporary closure of our manufacturing facilities in April and May, reduced travel expenses and reduced operating expenses related to the prior year rationalization of the Company’s North American manufacturing footprint.increased compensation expense.

Net sales for our European segment for the first ~~nine months~~half of ~~2020 decreased 24.9~~2021 increased 45.5 percent, compared to the same period in ~~2019,~~2020, due to a ~~26.2~~24.8 percent ~~decrease~~increase in volumes ~~which was primarily attributable~~related to our production shutdowns in the ~~on-going COVID-19 pandemic, including a production shut-down within~~latter part of the first quarter and the second quarter of ~~the year and lower aluminum prices, partially offset by improved~~2020, stronger product mix comprised of ~~higher~~larger diameter wheels and premium wheel ~~finishes.~~finishes, higher aluminum prices and favorable foreign exchange. European segment sales ~~between~~for Germany and Poland were approximately ~~37.2~~36.6 percent and ~~62.8~~63.4 percent, respectively, during the first ~~nine months~~half of ~~2020,~~2021, which compares to ~~35.5~~36.2 percent and ~~64.5~~63.8 percent for the first ~~nine months~~half of ~~2019.~~2020. European segment income from operations for the first ~~nine months~~half of ~~2020~~2021 was ~~lower~~higher than the prior year period ~~primarily~~principally due to ~~the first quarter 2020 goodwill and~~ ~~indefinite-lived intangible asset~~ ~~impairment charge, lower~~improved manufacturing performance associated with higher production volumes, ~~related to our key European OEM customers primarily due to the on-going COVID-19 pandemic, including a production shutdown within the second quarter, partially offset by~~ favorable product mix and ~~cost reductions related to second quarter facility closures and use of government subsidies in both Poland and Germany, reduced travel expenses and personnel restructurings.~~favorable foreign exchange.

As of ~~September~~June 30, ~~2020,~~2021, our cash and cash equivalents totaled ~~$111.1~~$149.2 million compared to ~~$49.3~~$130.7 million and ~~$77.9~~$152.4 million at ~~September~~June 30, ~~2019~~2020 and December 31, ~~2019,~~2020, respectively. Our sources of liquidity primarily include cash and cash equivalents, cash provided by operating activities, borrowings under available debt facilities, factoring arrangements for trade receivables and, from time to time, other external sources of funds. Working capital (current assets minus current liabilities) and our current ratio (current assets divided by current liabilities) were ~~$119.6~~$188.2 million and ~~1.5:~~1.7:1.0, respectively, at ~~September~~June 30, ~~2020,~~2021, versus ~~$163.1~~$152.5 million and ~~1.9:~~1.7:1.0, respectively, at December 31, ~~2019.~~2020. While the Company continues to tightly manage all elements of working capital, inventories have increased in 2021 not only due to the increase in production volumes, but also the volatility in customer orders arising from customer supply chain constraints, and to ensure our delivery capability in the second half of 2021.

Our working capital requirements, investing activities and cash dividend payments have historically been funded from internally generated funds, debt facilities, cash and cash equivalents, and we believe these sources will continue to meet our ~~requirements, as well as our currently anticipated short-term needs.~~future requirements. Capital expenditures ~~consist~~relate to improving production quality and efficiency and extending the useful lives of ~~ongoing maintenance~~existing property, plant and ~~operational improvements~~equipment (“maintenance”), as well as capital related to new product offerings and expanded capacity for existing products (“new business”). Over time, capital expenditures have consisted of roughly equal components of maintenance and new ~~business, the most significant of which in recent years has been our investment in physical vapor deposition technology which went into production in 2019.~~

In connection with the acquisition of our European operations, we entered into several debt and equity financing arrangements during 2017. On March 22, 2017, we entered into a USD Senior Secured Credit facility (“USD SSCF”) consisting of a $400.0 million Senior Secured Term Loan Facility (“Term Loan Facility”) and a $160.0 million Revolving Credit Facility (“Revolving Credit Facility”). On May 22, 2017, we issued 150,000 shares of redeemable preferred stock for an aggregate purchase price of $150.0 million. On June 15, 2017, we issued €250.0 million aggregate principal amount of 6.00 percent Senior Notes due June 15, 2025 (“the Notes”). Finally, as part of the European business acquisition, we also assumed $70.7 million of outstanding debt, including a €30.0 million European Revolving Credit Facility (“EUR SSCF”) (subsequently increased to ~~€45.0~~€60.0 million ~~during the second quarter of 2019). On~~on January 31, ~~2020, the available borrowing limit of the EUR SSCF was increased from €45.0 million to €60.0 million. All other terms of the EUR SSCF remained unchanged.~~2020). In addition, the European business entered into equipment loan agreements totaling $13.4 million (€12.0 million) in the fourth quarter of 2019. ~~During~~The Company drew down €10.6 million on these equipment loans in the first quarter of 2020 and drew the ~~Company drew down on these equipment loans and~~remaining €1.4 million in the ~~outstanding balance was $12.4 million as~~first quarter of ~~September 30, 2020.~~

2021. With the onset of the COVID-19 pandemic and the ensuing economic uncertainty, the Company drew down on its USD SSCF and EUR SSCF revolving credit facilities to provide additional ~~liquidity during the production shutdown and following resumption of operations until we were able to scale production volumes and restore profitability and positive free cash flow.~~liquidity. As of March 31, 2020, the Company had borrowings outstanding under these facilities of $207.9 million. ~~In addition the~~The Company took swift action beginning in March 2020 to reduce costs, including temporary facility closures, salary reductions, layoffs, furloughs, personnel restructurings, elimination or deferral of merit increases and reduced selected employee benefits across our global workforce in accordance with local laws and regulations. In the third quarterresumed all its operations by June of 2020 ~~our sales volume had returned to levels comparable to 2019, with sales 9.9 percent lower year-over-year in the third quarter~~ and only 2.0 percent lower for the month of September on a year-over-year basis. In addition, we restored profitability with net income of $11.1 million, generated cash flow from operations of $99.6 million and fully repaid the borrowings under the revolving credit facilities ~~during the third quarter of~~by September 30, 2020.

~~Both~~As part of our ~~revolving credit facilities mature~~ongoing efforts to improve our cash flow and related liquidity, we negotiate with suppliers to optimize our terms and conditions, including extended payment terms. Beginning in ~~May 2022, and based on various forecasted scenarios, Superior expects, at this time,~~2021, the Company receives extended payment terms for a portion of our purchases with one of our principal aluminum suppliers in exchange for a nominal adjustment to ~~remain compliant~~the product pricing. The payment terms provided to us are consistent with aluminum industry norms, as well as those offered to the supplier’s other customers. The supplier intends to finance these extended terms by factoring receivables due from us with a financial institution. We are not a party to the supplier’s factoring agreement with the financial institution. We remit payments directly to our supplier, except with respect to product purchased under extended terms which have been factored by the supplier. These payments are remitted directly to the financial institution in accordance with the payment terms originally negotiated with our supplier. As of ~~these facilities.~~June 30, 2021, the Company

owed $16.3 million to the financial institution which is included in accounts payable in the Company’s condensed consolidated balance sheet. The Company ~~has no other significant funded debt obligations until May 2024.~~

made $21.0 million in payments to the financial institution pursuant to the supplier’s factoring arrangement for the six months ended June 30, 2021. These payments are included in cash flows from operations within the condensed consolidated statements of cash flows.

Balances outstanding under the Term Loan Facility, Notes and equipment loans as of ~~September~~June 30, ~~2020~~2021 were $349.2 million, ~~$254.9~~$258.2 million and ~~$23.4~~$22.2 million, respectively. The redeemable preferred stock amounted to ~~$174.6~~$189.4 million as of ~~September~~June 30, ~~2020.~~2021. Our liquidity totaled ~~$336.3~~$347.8 million at ~~September~~June 30, ~~2020,~~2021, including cash on hand of ~~$111.1~~$149.2 million and available unused commitments under credit facilities of ~~$225.2~~$198.6 million.

On May 3, 2021, the Company extended the term of the Revolving Credit Facility under its USD SSCF. The commitment under the facility was reduced from $160.0 million to $132.5 million, with $25.0 million of the commitment maturing May 23, 2022 and the remaining $107.5 million maturing October 31, 2023. During the second quarter of 2021, the Company amended its European Revolving Credit Facility (“EUR SSCF”), extending the term to May 22, 2023 and increasing the applicable margins and commitment fees, while maintaining the €60.0 million commitment.

The following table summarizes the cash flows from operating, investing and financing activities as reflected in the condensed consolidated statements of cash flows.

Net cash provided by operating activities was ~~$92.5~~$31.9 million for the first ~~nine~~six months of ~~2020~~2021 compared to cash ~~provided~~used by operating activities of ~~$102.4~~$7.1 million for the same period in ~~2019.~~2020. The ~~decrease~~increase in cash flow provided by operating activities was primarily driven by ~~second quarter losses due to~~ ~~production shutdowns in April and May of 2020 at our key North American and European OEM customers. This was~~increased profitability, partially offset by ~~both the year-over-year reduction~~an increase in ~~net~~ working capital to support increased sales and ~~year-over-year increased earnings in~~production volumes, as compared to the ~~third quarter~~prior year. period.

Net cash used in investing activities was ~~$32.7~~$20.6 million for the first ~~nine~~six months of ~~2020~~2021 compared to ~~$38.0~~$22.8 million for the same period in ~~2019.~~2020. The decrease in investing activities is driven by ~~2020 reductions~~timing of pending capital projects to support increased production requirements in ~~capital expenditures, partially offset by a one-time benefit from the sale of other assets in the second quarter of 2019.~~both regions.

Net cash used in financing activities was ~~$32.1~~$13.5 million for the first ~~nine~~six months of ~~2020~~2021 compared to net cash ~~used in~~provided by financing activities of ~~$59.2~~$82.2 million for the same period in ~~2019.~~2020. This change was primarily due to ~~lower debt repayments, first quarter 2020 proceeds from capital equipment loans~~the draw down and partial repayment on borrowings under our revolving credit facilities, as well as prepayments on the ~~elimination of the common stock dividend~~Term Loan, in the ~~third quarter~~first half of ~~2019.~~2020.

As of ~~September~~June 30, ~~2020,~~2021, we had no significant off-balance sheet arrangements other than factoring of ~~$101.4~~$100.1 million of our trade receivables.

In this quarterly report, we discuss two important measures that are not calculated according to U.S. GAAP, value added sales and adjusted EBITDA.

Value added sales is a key measure that is not calculated according to U.S. GAAP. In the discussion of operating results, we provide information regarding value added sales. Value added sales represents net sales less the value of aluminum and services provided by outsourced service providers (“OSP”) that are included in net sales. As discussed further below, arrangements with our customers allow us to pass on changes in aluminum prices; therefore, fluctuations in underlying aluminum price generally does not directly impact our profitability. Accordingly,Our presentation of value added sales is ~~worthy of being highlighted for the benefit of users of our financial statements. Our intent is~~intended to allow users of the financial statements to consider our net sales information both with and without the aluminum and OSP cost components. Management utilizes value added sales as a key metric to determine growth of the Company because it eliminates the volatility of aluminum prices.

Adjusted EBITDA is a key measure that is not calculated according to U.S. GAAP. Adjusted EBITDA is defined as earnings before interest income and expense, income taxes, depreciation, amortization, restructuring charges and other closure costs and impairments of long-lived assets and investments, changes in fair value of redeemable preferred stock embedded derivative, acquisition and integration and other related costs, certain hiring and separation related costs, proxy contest fees, gains associated with early debt extinguishment and accounts receivable factoring fees. We use adjusted EBITDA as an important indicator of the operating performance of our business. Adjusted EBITDA is used in our internal forecasts and models when establishing internal operating budgets, supplementing the financial results and forecasts reported to our Board of Directors and evaluating short-term and long-term operating trends in our operations. We believe the adjusted EBITDA financial measure assists in providing a more complete understanding of our underlying operational measures to manage our business, to evaluate our performance compared to prior periods and the marketplace and to establish operational goals. Adjusted EBITDA is a non-GAAP financial measure and should not be considered in isolation or as a substitute for financial information provided in accordance with U.S. GAAP. This non-GAAP financial measure may not be computed in the same manner as similarly titled measures used by other companies.

The following table reconciles our net sales, the most directly comparable U.S. GAAP financial measure, to our value added sales:

The following table reconciles our net income, the most directly comparable U.S. GAAP financial measure, to our adjusted EBITDA:

	Three Months Ended						Nine Months Ended						Three Months Ended						Six Months Ended
	September 30, 2020			September 30, 2019			September 30, 2020			September 30, 2019			June 30, 2021			June 30, 2020			June 30, 2021			June 30, 2020
(Dollars in thousands)
Net income (loss)	$	11,146		$	(6,631	)	$	(222,154	)	$	2,589		$	1,695		$	(43,218	)	$	14,817		$	(233,300	)
Interest expense, net		10,414			11,807			34,448			35,532			10,486			12,184			20,759			24,034
Income tax provision (benefit)		(3,898	)		(4,785	)		(11,111	)		7,699			919			(3,753	)		1,729			(7,213	)
Depreciation		18,315			24,192			54,367			57,382			18,905			17,798			37,555			36,052
Amortization		6,503			6,636			18,767			20,118			6,704			6,127			13,415			12,264
Impairment of goodwill and indefinite-lived intangibles		—			—			193,641			—			—			—			—			193,641
Integration, restructuring, factoring fees and other ^{(1) (2) (3) (4)}		4,243			7,633			14,599			7,962
Integration, restructuring, factoring fees and other ⁽¹⁾⁽²⁾⁽³⁾⁽⁴⁾														3,791			7,166			7,833			10,356
Change in fair value or redeemable preferred stock embedded derivative liability ⁽⁵⁾														2,145			—			3,460			—
Adjusted EBITDA	$	46,723		$	38,852		$	82,557		$	131,282		$	44,645		$	(3,696	)	$	99,568		$	35,834
Adjusted EBITDA as a percentage of net sales		14.7	%		11.0	%		10.8	%		12.4	%		12.8	%		-2.6	%		14.1	%		8.0	%
Adjusted EBITDA as a percentage of value added sales		24.3	%		19.9	%		18.5	%		22.6	%		22.8	%		-4.4	%		24.7	%		14.1	%

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to apply significant judgment in making estimates and assumptions that affect amounts reported therein, as well as financial information included in this Management’s Discussion and Analysis of Financial Condition and Results of Operations. These estimates and assumptions, which are based upon historical experience, industry trends, terms of various past and present agreements and contracts, and information available from other sources that are believed to be reasonable under the circumstances, form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent through other sources. ~~There can be no assurance that actual results reported in~~We believe the ~~future will not differ from these~~accounting estimates ~~or that future changes in these estimates will not adversely impact our results of operations or financial condition.~~

~~Impairment of Goodwill~~ ~~–Goodwill~~employed are appropriate and ~~indefinite-lived intangible assets, such as certain trade names,~~the resulting balances are ~~not amortized, but are instead evaluated for impairment annually at the end of the fiscal year, or more frequently if events or circumstances indicate that impairment may be more likely than not.~~

At March 31, 2020, the impact of the COVID-19 developments and uncertainty with respect to the economic effects of the pandemic had introduced significant volatility in the financial markets and was having, and continues to have, a widespread adverse effect on the automotive industry, including reductions in both consumer demand and OEM automotive production. In response, our key customers temporarily closed nearly all production facilities in Europe and North America (our primary markets) during the quarter ended March 31, 2020. As a result, we concluded that an interim test of our goodwill was required. More specifically, the Company concluded that the following events and circumstances, in the aggregate, indicated that it was more likely than not that the carrying value of our European reporting unit exceeded its fair value at March 31, 2020: (1) our European reporting unit’s carrying value was effectively set to fair value at December 31, 2019,reasonable; however, due to the ~~$102.2 million impairment charges~~inherent uncertainties in developing estimates, actual results could differ from the original estimates, requiring adjustments to goodwill and indefinite-lived intangibles, (2) lower forecasted 2020 industry production volumes for Western and Central Europe, including those for our primary European customers, due to OEM shutdowns to mitigate COVID-19 spread and subsequent reduced production levels over the remainder of the year, as compared to our prior production forecasts (including estimates used in our 2019 assessment), and (3) the volatility in financial markets that has both increased European interest rates due to rising credit spreads and risk premiums and lowered median European automotive market multiples. Based on the results of our quantitative analysis, we recognized a non-cash goodwill impairment charge equal to the remaining goodwill balance of $182.6 million since the carrying value exceeded the fair value of the European reporting unit by more than the amount of the goodwill balance at March 31, 2020. This impairment was recognized at March 31, 2020 as a separate charge (together with the indefinite-lived intangible asset trade name) included in income (loss) from operations.

We utilized both an income and a market approach, weighted 75 percent and 25 percent respectively, to determine the fair value of the European reporting unit as part of our goodwill impairment assessment. The income approach is based on projected debt-free cash flow, which is discounted to the present value using discount factors that consider the timing and risk of cash flows. The discount rate used is the weighted average of an estimated cost of equity and of debt (“weighted average cost of capital”). The weighted average cost of capital is adjusted as necessary to reflect risk associated with the business of the European reporting unit. Financial projections are based on estimated production volumes, product prices and expenses, including raw material cost, wages, energy and other expenses. Other significant assumptions include terminal value cash flow and growth rates, future capital expenditures and changesthese balances in future ~~working capital requirements. The market approach is based on~~periods. Critical accounting estimates that affect the observed ratios of enterprise value to earnings before interest, taxes, depreciation and amortization (EBITDA) of comparable, publicly traded companies. The market approach fair value is determined by multiplying historical and anticipated financial metrics of the European reporting unit by the EBITDA pricing multiples derived from comparable, publicly traded companies.

At March 31, 2020, we determined that the carrying value of the European reporting unit exceeded its fair value by an amount greater than the remaining goodwill balance. The decline in fair value was primarily due to significantly lower market multiples and increased discount rates, as well as further declines in forecasted industry production volumes in Western and Central Europe as a result of the COVID-19 pandemic and consequent economic instability. Forecasted revenues, EBITDA and cash flow for the European reporting unit also declined as compared to the prior year long-range plan due to lower forecasted industry production volumes which adversely impacted fair value under both the income and market approaches. In determining the fair value, the Company weighted the income and market approaches, 75 percent and 25 percent, respectively. Significant assumptions used under the income approach included a weighted average cost of capital (WACC) of 12.0 percent and a long-term growth rate of 1.5 percent, as compared to 10.0 percent and 2.0 percent, respectively, used in the 2019 assessment. In determining the WACC, management considered the level of risk inherent in

the cash flow projections and current market conditions, including the significant increase in credit spreads and systemic market and Company specific risk premiums. The decline in the fair value under the market approach is attributable to the decline in the average EBITDA market multiple (4.9X EBITDA in 2020, 5.7X EBITDA in 2019) ~~and lower forecasted EBITDA, as compared to the 2019 assessment~~.The use of these unobservable inputs results in classification of the fair value estimate as a Level 3 measurement in the fair value hierarchy. A considerable amount of management judgment and assumptions are required in ~~performing~~ the quantitative impairment test, principally related to determining the fair value of the reporting unit. While the Company believes its judgments and assumptions are reasonable, different assumptions could change the estimated fair value.

~~Impairment of Intangible Assets~~ ~~– Intangible assets include both finite and indefinite-lived intangible assets. Finite-lived~~ intangible assets consist of brand names, technology and customer relationships. Finite-lived intangible assets are amortized on a straight-line over their estimated useful lives (since the pattern in which the asset will be consumed cannot be reliably determined). Indefinite-lived intangible assets, excluding goodwill, consist of trade names associated with our aftermarket business. In the first quarter of 2020, we recognized a non-cash impairment charge of $11.0 million related to our aftermarket trade name indefinite-lived intangible asset which was primarily attributable to a further decline in forecasted aftermarket revenues and a decline in associated profitability (refer to Note 8, “Goodwill and Other Intangible Assets” ~~in the notes to~~ condensed consolidated financial statements and the judgments and assumptions used are consistent with those described in ~~Item 1, “Financial Statements~~the management’s discussion and ~~Supplementary Data”~~analysis in ~~this Quarterly Report for further discussion of asset impairments).~~

~~Also see Item 7—~~our 2020 Form 10-K (refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II of our ~~2019~~ Annual Report on Form ~~10-K.~~10-K for the year ended December 31, 2020).

~~Not applicable for~~As a smaller reporting ~~companies.~~company, as defined in Rule 10(f)(1) of Regulation S-K under the Securities and Exchange Act of 1934, as amended (the “Exchange Act”), the Company is not required to provide the information required by this item.

The Company’s management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of ~~September~~June 30, ~~2020.~~2021. Our disclosure controls and procedures are designed to ensure that information required to be disclosed in reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosures.

Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of ~~September~~June 30, ~~2020~~2021 our disclosure controls and procedures were effective.

There has been no change in our internal control over financial reporting during the ~~nine~~six months ended ~~September~~June 30, ~~2020~~2021 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

We are party to various legal and environmental proceedings incidental to our business. Certain claims, suits and complaints arising in the ordinary course of business have been filed or are pending against us. Based on facts now known, we believe all such matters are adequately provided for, covered by insurance, are without merit, and/or involve such amounts that would not materially adversely affect our consolidated results of operations, cash flows or financial position. See also under Item 1A, “Risk Factors - We are from time to time subject to litigation, which could adversely impact our financial condition or results of operations” of our Annual Report on Form 10-K for the year ended December 31, ~~2019.~~2020.

We are exposed to certain risks and June 30, 2020, we added the below risk factors entitled “The COVID-19 pandemic has disrupted, and may continue to disrupt our business, which we expect will have a material adverse impact on our business, results of operations and financial condition” and “A delisting of our common stock from the NYSE could reduce the liquidity and market price of our common stock; reduce the number of investors and analystsuncertainties that ~~cover our common stock; limit our ability to issue additional shares, and damage our reputation which~~ could have a material adverse impact on our business, ~~results of operations~~financial condition and financial condition. In addition, a delisting of our common stock from the NYSE could cause a redemption of some or all of our outstanding redeemable preferred stock which would negatively impact our liquidity”operating results. There have been no material changes to the ~~risk factors as previously disclosed~~Risk Factors described in ~~“Item 1A Risk Factors” of~~Part I, Item 1A-Risk Factors in our annual report on Form 10-K for the year ended December 31, ~~2019. Other than~~2020, except as ~~set forth below, there have been no material changes to~~otherwise indicated in the ~~risk factors set forth~~following sentence. During May 2021, the NYSE notified the Company that, in ~~“Item 1A Risk Factors”~~view of our ~~Form 10-K~~improved market capitalization which has been well in excess of the required threshold for the ~~year ended December 31, 2019. However, many of the risk factors set forth~~past six months, we are again in ~~our Form 10-K for the year ended December 31, 2019 are, and will continue to be, exacerbated by the COVID-19 pandemic and any resulting worsening of the economic environment.~~

~~The COVID-19 pandemic has disrupted, and may continue to disrupt our business, which we expect will have a material adverse impact on our business, results of operations and financial condition.~~

The ongoing COVID-19 pandemic has caused a widespread health crisis, resulting in an economic downturn and government imposed measures to reduce the spread of COVID-19. In Europe and North America (our primary markets), federal, state and local governments have either recommended or mandated actions to slow the transmission of COVID-19. Most U.S. states and most countries have been implementing shelter-in-place orders, quarantines, significant restrictions on travel, as well as work restrictions that prohibit non-essential employees from going to work. The impact of COVID-19 and uncertaintycompliance with respect to the economic effects of the pandemic has introduced significant volatility in the financial markets and is having a widespread adverse effect on the automotive industry. Specific risks to our Company associated with the COVID-19 pandemic include the following:

The ultimate impact that COVID-19 will have on our business, results of operations and financial condition will depend on a number of evolving factors that we may not be able to accurately predict, including: the duration and scope of the pandemic; governmental, OEMs’, suppliers’, customers’ and individuals’ actions that have been and continue to be taken in response to the pandemic and the impact of the pandemic on economic activity and actions taken in response to such impact by the OEMs’ suppliers and customers.

A delisting of our common stock from the NYSE could reduce the liquidity and market price of our common stock; reduce the number of investors and analysts that cover our common stock; limit our ability to issue additional shares, and damage our reputation which could have a material adverse impact on our business, results of operations and financial condition. In addition, a delisting of our common stock from the NYSE could cause a redemption of some or all of our outstanding redeemable preferred stock which would negatively impact our liquidity.

~~We are required under the NYSE~~its continued listing standards to maintain a market capitalization of at least $50 million, over a consecutive 30 trading-day period, and maintain stockholders’ equity of at least $50 million. As of March 31, 2020, our market capitalization was less than $50 million over a consecutive 30-day trading period and our stockholders’ equity was less that the minimum threshold. As a result, on June 5, 2020, the NYSE sent us a formal notification that we were not compliance with the NYSE continued listing standards. In response, on July 20, 2020, we submitted a remediation plan to the NYSE and on September 8, 2020 we announced that our remediation plan had been accepted by the NYSE. The cure period effectively began on July 1, 2020 and will end on January 1, 2022. In the event we are unable to cure the deficiency during the 18-month period, our stock may be delisted from the NYSE.

~~A delisting of our common stock could have a material adverse impact on our business, results of operations and financial condition by, among other things:~~

In addition, the holder of our redeemable preferred stock has the right to redeem all of the outstanding shares of redeemable preferred stock if our common stock is delisted from the NYSE. If we are delisted from the NYSE and the holder exercises its right to redeem all of the outstanding shares of redeemable preferred stock, we would be required to: (1) increase the then carrying value of the redeemable preferred stock to the $300 million redemption value through a corresponding charge (decrease) to our retained earnings, and (2) make a redemption payment in any amount up to $300 million if our Board determined, under Delaware law, that there was a “surplus” to fund a full or partial redemption and such payment would not render us insolvent. The shares of preferred stock that have not been redeemed would continue to receive a dividend of 9 percent per annum on the Stated Value, as defined in the Certificate of Designations, until such shares of preferred stock are redeemed. A redemption payment, if required, for some or all of our outstanding shares of preferred stock would negatively impact our liquidity and could adversely affect our business, results of operations and financial condition.

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Delaware	95-2594729
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)

26600 Telegraph Road, Suite 400
Southfield, Michigan	48033
(Address of Principal Executive Offices)	(Zip Code)


Title of Each Class	Trading Symbol	Name of Each Exchange on Which Registered
Common Stock, $0.01 par value	SUP	New York Stock Exchange

					Page
PART I	-	FINANCIAL INFORMATION

		Item 1	-	Financial Statements (Unaudited)

				Condensed Consolidated Statements of Income (Loss)	1

				Condensed Consolidated Statements of Comprehensive Income (Loss)	2

				Condensed Consolidated Balance Sheets	3

				Condensed Consolidated Statements of Cash Flows	4

				Condensed Consolidated Statements of Shareholders’ Equity (Deficit)	5

				Notes to Condensed Consolidated Financial Statements	7

		Item 2	-	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2726

		Item 3	-	Quantitative and Qualitative Disclosures About Market Risk	4037

		Item 4	-	Controls and Procedures	4037

PART II	-	OTHER INFORMATION			4138

		Item 1	-	Legal Proceedings	4138

		Item 1A	-	Risk Factors	4138

		Item 2	-	Unregistered Sales of Equity Securities and Use of Proceeds	4238

		Item 5	-	Other Information	4238

		Item 6	-	Exhibits	4339

		Signatures			4440

	September 30, 2020		December 31, 2019		Change
(Dollars in thousands)								June 30, 2021		December 31, 2020		Change
Customer receivables	$	72,272	$	68,283	$	3,989		$	77,001	$	40,785	$	36,216
Contract liabilities—current		8,105		5,880		2,225			7,376		8,249		(873	)
Contract liabilities—noncurrent		12,465		13,577		(1,112	)		11,264		13,106		(1,842	)

			Fair Value Measurement at Reporting Date Using								Fair Value Measurement at Reporting Date Using
September 30, 2020			Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
June 30, 2021											Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
(Dollars in thousands)
Assets
Derivative contracts	$	3,016	$	—	$	3,016	$	—	$	12,770	$	—	$	12,770	$	—
Total	$	3,016	$	—	$	3,016	$	—	$	12,770	$	—	$	12,770	$	—
Liabilities					.								.
Derivative contracts	$	28,984	$	—	$	28,984	$	—	$	10,502	$	—	$	10,502	$	—
Total	$	28,984	$	—	$	28,984	$	—	$	10,502	$	—	$	10,502	$	—

(Unaudited)	Common Stock				Accumulated Other Comprehensive (Loss) Income
	Number of Shares		Amount		Unrecognized Gains (Losses) on Derivative Instruments			Pension Obligations			Cumulative Translation Adjustment			Retained Earnings			Total
BALANCE AT DECEMBER 31, 2018		25,019,237	$	87,723	$	(3,205	)	$	(3,000	)	$	(99,290	)	$	391,037		$	373,265
Net income		—		—		—			—			—			2,589			2,589
Change in unrecognized gains/losses on derivative instruments, net of tax		—		—		(1,520	)		—			—			—			(1,520	)
Change in employee benefit plans, net of taxes		—		—		—			122			—			—			122
Net foreign currency translation adjustment		—		—		—			—			(21,459	)		—			(21,459	)
Common stock issued, net of shares withheld for employee taxes		108,921		—		—			—			—			—			—
Stock-based compensation		—		3,587		—			—			—			—			3,587
Cash dividend declared ($0.09 per common share)		—		—		—			—			—			(4,597	)		(4,597	)
Redeemable preferred 9% dividend, participating dividend and accretion		—		—		—			—			—			(23,275	)		(23,275	)
European non-controlling redeemable equity dividend		—		—		—			—			—			(496	)		(496	)
BALANCE AT SEPTEMBER 30, 2019		25,128,158	$	91,310	$	(4,725	)	$	(2,878	)	$	(120,749	)	$	365,258		$	328,216

For the three months ended September 30, 2019

(Unaudited)	Common Stock				Accumulated Other Comprehensive (Loss) Income
	Number of Shares		Amount		Unrecognized Gains (Losses) on Derivative Instruments			Pension Obligations			Cumulative Translation Adjustment			Retained Earnings			Total
BALANCE AT JUNE 30, 2019		25,114,598	$	89,532	$	3,577		$	(2,917	)	$	(98,606	)	$	379,604		$	371,190
Net loss		—		—		—			—			—			(6,631	)		(6,631	)
Change in unrecognized gains/losses on derivative instruments, net of tax		—		—		(8,302	)		—			—			—			(8,302	)
Change in employee benefit plans, net of taxes		—		—		—			39			—			—			39
Net foreign currency translation adjustment		—		—		—			—			(22,143	)		—			(22,143	)
Common stock issued, net of shares withheld for employee taxes		13,560		—		—			—			—			—			—
Stock-based compensation		—		1,778		—			—			—			—			1,778
Cash dividend declared ($0.09 per common share)		—		—		—			—			—			(15	)		(15	)
Redeemable preferred 9% dividend and accretion		—		—		—			—			—			(7,587	)		(7,587	)
European non-controlling redeemable equity dividend		—		—		—			—			—			(113	)		(113	)
BALANCE AT SEPTEMBER 30, 2019		25,128,158	$	91,310	$	(4,725	)	$	(2,878	)	$	(120,749	)	$	365,258		$	328,216

			Fair Value Measurement at Reporting Date Using								Fair Value Measurement at Reporting Date Using
December 31, 2019			Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
December 31, 2020											Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
(Dollars in thousands)
Assets
Derivative contracts	$	21,973	$	—	$	21,973	$	—	$	10,218	$	—	$	10,218	$	—
Total	$	21,973	$	—	$	21,973	$	—	$	10,218	$	—	$	10,218	$	—
Liabilities
Derivative contracts	$	8,709	$	—	$	8,709	$	—	$	15,259	$	—	$	15,259	$	—
Total	$	8,709	$	—	$	8,709	$	—	$	15,259	$	—	$	15,259	$	—

	September 30, 2020								June 30, 2021
	Other Current Assets		Other Non-current Assets		Accrued Liabilities		Other Non-current Liabilities		Other Current Assets		Other Non-current Assets		Accrued Liabilities		Other Non-current Liabilities
(Dollars in thousands)
Foreign exchange forward contracts designated as hedging instruments	$	794	$	867	$	7,753	$	10,293	$	2,642	$	6,404	$	456	$	2,147
Foreign exchange forward contracts not designated as hedging instruments		7		—		466		—		277		—		1,237		—
Aluminum forward contracts designated as hedging instruments		—		—		123		—		1,609		—		—		—
Natural gas forward contracts designated as hedging instruments		837		511		142		39		1,509		329		4		—
Interest rate swap contracts designated as hedging instruments		—		—		4,872		5,296		—		—		4,754		1,904
Total derivative financial instruments	$	1,638	$	1,378	$	13,356	$	15,628	$	6,037	$	6,733	$	6,451	$	4,051

Three Months Ended September 30, 2020	Amount of Gain or (Loss) Recognized in AOCI on Derivatives			Amount of Pre-tax Gain or (Loss) Reclassified from AOCI into Income			Amount of Pre-tax Gain or (Loss) Recognized in Income on Derivatives
Three Months Ended June 30, 2021										Amount of Gain or (Loss) Recognized in AOCI on Derivatives		Amount of Pre-tax Gain or (Loss) Reclassified from AOCI into Income		Amount of Pre-tax Gain or (Loss) Recognized in Income on Derivatives
(Dollars in thousands)
Derivative Contracts	$	4,683		$	(2,261	)	$	3,458		$	15,447	$	758	$	1,638
Total	$	4,683		$	(2,261	)	$	3,458		$	15,447	$	758	$	1,638

Nine Months Ended September 30, 2020	Amount of Gain or (Loss) Recognized in AOCI on Derivatives			Amount of Pre-tax Gain or (Loss) Reclassified from AOCI into Income			Amount of Pre-tax Gain or (Loss) Recognized in Income on Derivatives
Six Months Ended June 30, 2021										Amount of Gain or (Loss) Recognized in AOCI on Derivatives		Amount of Pre-tax Gain or (Loss) Reclassified from AOCI into Income		Amount of Pre-tax Gain or (Loss) Recognized in Income on Derivatives
(Dollars in thousands)
Derivative Contracts	$	(25,316	)	$	(7,355	)	$	(289	)	$	6,985	$	319	$	(1,266	)
Total	$	(25,316	)	$	(7,355	)	$	(289	)	$	6,985	$	319	$	(1,266	)

Three Months Ended September 30, 2019	Amount of Gain or (Loss) Recognized in AOCI on Derivatives			Amount of Pre-tax Gain or (Loss) Reclassified from AOCI into Income		Amount of Pre-tax Gain or (Loss) Recognized in Income on Derivatives
Three Months Ended June 30, 2020								Amount of Gain or (Loss) Recognized in AOCI on Derivatives			Amount of Pre-tax Gain or (Loss) Reclassified from AOCI into Income			Amount of Pre-tax Gain or (Loss) Recognized in Income on Derivatives
(Dollars in thousands)
Derivative Contracts	$	(8,302	)	$	703	$	1,817	$	15,298		$	(3,980	)	$	1,692
Total	$	(8,302	)	$	703	$	1,817	$	15,298		$	(3,980	)	$	1,692

Nine Months Ended September 30, 2019	Amount of Gain or (Loss) Recognized in AOCI on Derivatives			Amount of Pre-tax Gain or (Loss) Reclassified from AOCI into Income		Amount of Pre-tax Gain or (Loss) Recognized in Income on Derivatives
Six Months Ended June 30, 2020								Amount of Gain or (Loss) Recognized in AOCI on Derivatives			Amount of Pre-tax Gain or (Loss) Reclassified from AOCI into Income			Amount of Pre-tax Gain or (Loss) Recognized in Income on Derivatives
(Dollars in thousands)
Derivative Contracts	$	(1,520	)	$	2,417	$	3,557	$	(29,999	)	$	(5,094	)	$	(3,747	)
Total	$	(1,520	)	$	2,417	$	3,557	$	(29,999	)	$	(5,094	)	$	(3,747	)

(Dollars in thousands)	Net Sales				Income from Operations					Net Sales				Income (loss) from Operations
Three Months Ended	September 30, 2020		September 30, 2019		September 30, 2020		September 30, 2019			June 30, 2021		June 30, 2020		June 30, 2021		June 30, 2020
North America	$	166,662	$	188,089	$	16,113	$	(4,440	)	$	176,990	$	58,916	$	7,542	$	(19,792	)
Europe		150,441		163,925		3,125		4,197			170,474		85,919		7,978		(14,325	)
	$	317,103	$	352,014	$	19,238	$	(243	)	$	347,464	$	144,835	$	15,520	$	(34,117	)

(Dollars in thousands)	Depreciation and Amortization				Capital Expenditures					Depreciation and Amortization				Capital Expenditures
Three Months Ended	September 30, 2020		September 30, 2019		September 30, 2020		September 30, 2019			June 30, 2021		June 30, 2020		June 30, 2021		June 30, 2020
North America	$	8,742	$	15,432	$	6,673	$	5,425		$	9,499	$	8,420	$	3,447	$	5,876
Europe		16,076		15,396		4,158		13,494			16,110		15,504		6,625		3,020
	$	24,818	$	30,828	$	10,831	$	18,919		$	25,609	$	23,924	$	10,072	$	8,896

(Dollars in thousands)	Property, Plant and Equipment, net				Goodwill and Intangible Assets				Property, Plant and Equipment, net				Intangible Assets
	September 30, 2020		December 31, 2019		September 30, 2020		December 31, 2019		June 30, 2021		December 31, 2020		June 30, 2021		December 31, 2020
North America	$	214,656	$	237,372	$	—	$	—	$	209,016	$	220,145	$	—	$	—
Europe		292,381		291,910		112,341		321,910		294,070		301,979		93,942		110,796
	$	507,037	$	529,282	$	112,341	$	321,910	$	503,086	$	522,124	$	93,942	$	110,796

As of September 30, 2020	Gross Carrying Amount		Impairment			Accumulated Amortization			Currency Translation			Net Carrying Amount		Remaining Weighted Average Amortization Period
As of June 30, 2021															Gross Carrying Amount		Accumulated Impairment			Accumulated Amortization			Currency Translation			Net Carrying Amount		Remaining Weighted Average Amortization Period
(Dollars in thousands)
Brand name	$	9,000	$	—		$	(6,136	)	$	269		$	3,133	2-3	$	9,000	$	—		$	(7,577	)	$	322		$	1,745	1-2
Technology		15,000		—			(10,226	)		441			5,215	1-3		15,000		—			(12,628	)		537			2,909	2
Customer relationships		167,000		—			(68,940	)		5,933			103,993	3-8		167,000		—			(85,132	)		7,420			89,288	2-7
Total finite		191,000		—			(85,302	)		6,643			112,341			191,000		—			(105,337	)		8,279			93,942
Trade names		14,000		(13,772	)		—			(228	)		—	Indefinite		14,000		(13,772	)		—			(228	)		—	Indefinite
Total intangibles	$	205,000	$	(13,772	)	$	(85,302	)	$	6,415		$	112,341		$	205,000	$	(13,772	)	$	(105,337	)	$	8,051		$	93,942

As of December 31, 2020	Gross Carrying Amount		Accumulated Impairment			Accumulated Amortization			Currency Translation			Net Carrying Amount		Remaining Weighted Average Amortization Period
(Dollars in thousands)
Brand name	$	9,000	$	—		$	(6,615	)	$	399		$	2,784	2-3
Technology		15,000		—			(11,024	)		666			4,642	1-3
Customer relationships		167,000		—			(74,322	)		10,692			103,370	3-8
Total finite		191,000		—			(91,961	)		11,757			110,796
Trade names		14,000		(13,772	)		—			(228	)		—	Indefinite
Total intangibles	$	205,000	$	(13,772	)	$	(91,961	)	$	11,529		$	110,796

Nine Months Ended September 30, 2020	Beginning Balance													Ending Balance
	Gross		Accumulated Impairment			Net Balance		Impairment			Currency Translation			Gross		Accumulated Impairment			Net Balance
(Dollars in thousands)
Goodwill	$	284,337	$	(99,505	)	$	184,832	$	(182,528	)	$	(2,304	)	$	282,033	$	(282,033	)	$	—

As of December 31, 2019	Gross Carrying Amount		Impairment			Accumulated Amortization			Currency Translation			Net Carrying Amount		Remaining Weighted Average Amortization Period
(Dollars in thousands)
Brand name	$	9,000	$	—		$	(4,778	)	$	110		$	4,332	3-4
Technology		15,000		—			(7,963	)		183			7,220	2-4
Customer relationships		167,000		—			(53,681	)		954			114,273	4-9
Total finite		191,000		—			(66,422	)		1,247			125,825
Trade names		14,000		(2,733	)		—			(14	)		11,253	Indefinite
Total intangibles	$	205,000	$	(2,733	)	$	(66,422	)	$	1,233		$	137,078

Year Ended December 31, 2019	Beginning Balance												Ending Balance
Year Ended December 31, 2020																				Beginning Balance													Ending Balance
	Gross		Accumulated Impairment		Net Balance		Impairment			Currency Translation			Gross		Accumulated Impairment			Net Balance		Gross		Accumulated Impairment			Net Balance		Impairment			Currency Translation			Gross		Accumulated Impairment			Net Balance
(Dollars in thousands)
Goodwill	$	291,434	$	—	$	291,434	$	(99,505	)	$	(7,097	)	$	284,337	$	(99,505	)	$	184,832	$	284,337	$	(99,505	)	$	184,832	$	(182,602	)	$	(2,230	)	$	282,107	$	(282,107	)	$	—

	September 30, 2020 (Dollars in Thousands)											June 30, 2021 (Dollars in Thousands)
Debt Instrument	Total Debt		Debt Issuance Costs ⁽¹⁾			Total Debt, Net			Weighted Average Interest Rate			Total Debt		Debt Issuance Costs ⁽¹⁾			Total Debt, Net			Weighted Average Interest Rate
Term Loan Facility	$	349,200	$	(7,790	)	$	341,410			4.1	%	$	349,200	$	(5,251	)	$	343,949			4.1	%
6.00% Senior Notes due 2025		254,904		(4,670	)		250,234			6.0	%
6.00% Senior Notes													258,224		(3,933	)		254,291			6.0	%
European CapEx Loans		23,410		—			23,410			2.4	%		22,212		—			22,212			2.3	%
Finance Leases		2,686		—			2,686			3.0	%		3,305		—			3,305			2.8	%
	$	630,200	$	(12,460	)		617,740					$	632,941	$	(9,184	)		623,757
Less: Current portion							(6,034	)										(6,545	)
Long-term debt						$	611,706										$	617,212

	December 31, 2019 (Dollars in Thousands)											December 31, 2020 (Dollars in Thousands)
Debt Instrument	Total Debt		Debt Issuance Costs ⁽¹⁾			Total Debt, Net			Weighted Average Interest Rate			Total Debt		Debt Issuance Costs ⁽¹⁾			Total Debt, Net			Weighted Average Interest Rate
Term Loan Facility	$	371,800	$	(10,192	)	$	361,608			5.7	%	$	349,200	$	(7,155	)	$	342,045			4.1	%
6.00% Senior Notes due 2025		243,074		(5,408	)		237,666			6.0	%
European CapEx Loan		12,693		—			12,693			2.2	%
6.00% Senior Notes													266,928		(4,425	)		262,503			6.0	%
European CapEx Loans													23,668		—			23,668			2.3	%
Finance Leases		3,068		—			3,068			2.9	%		3,388		—			3,388			3.0	%
	$	630,635	$	(15,600	)		615,035					$	643,184	$	(11,580	)		631,604
Less: Current portion							(4,010	)										(6,112	)
Long-term debt						$	611,025										$	625,492


(Dollars in thousands)
Debt Maturities	Amount
Six remaining months of 2021	$	3,374
2022		6,450
2023		6,031
2024		352,418
2025		260,563
Thereafter		4,105
Total debt liabilities	$	632,941

Balance at December 31, 2018	$	13,849
Dividends accrued		566
Dividends paid		(848	)
Translation adjustment		(361	)
Purchase of shares		(6,681	)
(Dollars in thousands)
Balance at December 31, 2019		6,525		$	6,525
Dividends accrued		152			205
Dividends paid		(45	)		(46	)
Translation adjustment		(71	)		2
Purchase of shares		(4,981	)		(5,020	)
Balance at September 30, 2020	$	1,580
Balance at December 31, 2020					1,666
Dividends accrued					38
Dividends paid					(3	)
Translation adjustment					(53	)
Purchase of shares					(58	)
Balance at June 30, 2021				$	1,590

Three months ended	June 30, 2021			June 30, 2020
(Dollars in millions)	Percent of Sales	Dollars		Percent of Sales	Dollars
GM	27%	$	93.4	18%	$	27.4
VW Group	16%	$	53.8	19%	$	28.6
Ford	10%	$	30.9	10%	$	12.9


Six months ended	June 30, 2021			June 30, 2020
(Dollars in millions)	Percent of Sales	Dollars		Percent of Sales	Dollars
GM	27%	$	187.5	22%	$	100.1
VW Group	15%	$	108.0	16%	$	72.5
Ford	11%	$	80.0	12%	$	52.3

10.1		~~Offer Letter of Employment,~~Fifth Amendment to Credit Agreement, dated ~~August 17, 2020 between~~May 3, 2021, among Superior Industries International, ~~Inc.~~Inc, the subsidiaries of Superior identified therein, CITIBANK, N.A., as Administrative Agent, JPMorgan Chase Bank N.A., as Sub-Agent, and ~~Timothy Trenary.~~the Lenders and Issuing Banks party thereto (Incorporated by reference to Exhibit 10.1 to the Registrant’s ~~Current~~Quarterly Report on Form ~~8-K dated August 25, 2020)~~10-Q for the quarter ended March 31, 2021).*
10.2		~~Retention Letter Agreement, dated August 25, 2020, between Superior Industries International, Inc. and Majdi B. Abulaban.~~2018 Equity Incentive Plan, As Amended (Incorporated by reference to ~~Exhibit 10.2 to~~Appendix B of the Registrant’s ~~Current Report~~Definitive Proxy Statement on ~~Form 8-K dated August 25, 2020)~~Schedule 14A filed on April 15, 2021).~~, **~~
~~10.3~~	~~Retention Letter Agreement, dated August 25, 2020, between Superior Industries International, Inc. and Kevin Burke.~~ (Incorporated by reference to Exhibit 10.3 to the Registrant’s Current Report on Form 8-K dated August 25, 2020).*
31.1		Chief Executive Officer Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 302(a) of the Sarbanes-Oxley Act of 2002.**

31.2		Chief Financial Officer Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 302(a) of the Sarbanes-Oxley Act of 2002.**

32.1		Certification of Majdi B. Abulaban, President and Chief Executive Officer, and C. Timothy Trenary, Executive Vice President and Chief Financial Officer, Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.**

101.INS		Inline XBRL Instance Document—the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document ****

101.SCH		Inline XBRL Taxonomy Extension Schema Document ****

101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document ****

101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document ****

101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document ****

101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document ****

104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in exhibit 101) ****