Volkswagen’s electric car orders double in Europe

New orders for electric cars more than doubled in Europe, Volkswagen said in an earnings statement Tuesday. The company does not release order numbers for other markets. The jump in orders at Europe’s biggest carmaker comes amid concerns about slowing EV sales in the region, and as EV makers grapple with slim profits margins, squeezed by increasing competition.

“The future will be electric, this is our conviction,” chief financial officer Arno Antlitz told analysts and journalists on a call Tuesday. He acknowledged, however, that the pace of EV sales growth in Europe and the United States had been slower than the German carmaker had originally anticipated.

EV penetration “will increase quarter-by-quarter, year-over-year, but not as fast as we have expected,” he said. As for Volkswagen’s EV deliveries, they declined 16% in Europe in the first quarter compared with the same period in 2023. “All-electric deliveries in Europe were impacted by supply bottlenecks,” a company spokesperson told CNN. “There is a time gap between incoming orders and the delivery to the customer. The supply bottlenecks mentioned impacted the delivery performance in Q1.”

Meanwhile, in China, Volkswagen’s single largest market, EV deliveries almost doubled to 41,033 units from a “weak prior-year figure,” the company said in a statement. The champion of German manufacturing is struggling to defend its share of the Chinese car market — the biggest in the world — where it has fallen behind Tesla and local EV producers such as BYD.

Volkswagen said its plans to significantly reduce battery and material costs would enable it to be cost-competitive with Chinese rivals by 2026. That should then allow it to reduce the price of its EVs in China, where fierce competition has led to intense price wars. On EVs, “you see… a very challenging pricing environment” in China, Antlitz said. He added that Volkswagen would make “sound compromises” between “pricing and volume” in the country.