diff --git a/sdk_container/.repo/manifests/version.txt b/sdk_container/.repo/manifests/version.txt
index a586aae0a9..4ebbac5531 100644
--- a/sdk_container/.repo/manifests/version.txt
+++ b/sdk_container/.repo/manifests/version.txt
@@ -1,4 +1,4 @@
-FLATCAR_VERSION=3277.0.0+nightly-20220720-2100
-FLATCAR_VERSION_ID=3277.0.0
-FLATCAR_BUILD_ID="nightly-20220720-2100"
+FLATCAR_VERSION=3277.1.0+nightly-20220725-2100
+FLATCAR_VERSION_ID=3277.1.0
+FLATCAR_BUILD_ID="nightly-20220725-2100"
 FLATCAR_SDK_VERSION=3277.0.0
diff --git a/sdk_container/src/third_party/coreos-overlay b/sdk_container/src/third_party/coreos-overlay
index 9a20e757e9..e46bebc8e8 160000
--- a/sdk_container/src/third_party/coreos-overlay
+++ b/sdk_container/src/third_party/coreos-overlay
@@ -1 +1 @@
-Subproject commit 9a20e757e914bac53ba1d96988e8cb68e9622ed6
+Subproject commit e46bebc8e895fd93e5ff14d60a8d961be879c4e7