diff --git a/sdk_container/.repo/manifests/version.txt b/sdk_container/.repo/manifests/version.txt
index c8f841a14b..194283f3f3 100644
--- a/sdk_container/.repo/manifests/version.txt
+++ b/sdk_container/.repo/manifests/version.txt
@@ -1,4 +1,4 @@
-FLATCAR_VERSION=3257.0.0+nightly-20220601-2100
-FLATCAR_VERSION_ID=3257.0.0
-FLATCAR_BUILD_ID="nightly-20220601-2100"
-FLATCAR_SDK_VERSION=3257.0.0+nightly-20220601-2100
+FLATCAR_VERSION=3258.0.0+nightly-20220602-2100
+FLATCAR_VERSION_ID=3258.0.0
+FLATCAR_BUILD_ID="nightly-20220602-2100"
+FLATCAR_SDK_VERSION=3258.0.0+nightly-20220602-2100
diff --git a/sdk_container/src/third_party/coreos-overlay b/sdk_container/src/third_party/coreos-overlay
index 5eb5b47845..7804f638b6 160000
--- a/sdk_container/src/third_party/coreos-overlay
+++ b/sdk_container/src/third_party/coreos-overlay
@@ -1 +1 @@
-Subproject commit 5eb5b47845d0d320361f326fe621debf7110b462
+Subproject commit 7804f638b662c838a7ef7cd1587e63d784499714