Operating profit declined by a fifth to €4.6 billion (US$4.9 billion) in the period, Volkswagen said Tuesday, missing analyst expectations. The manufacturer confirmed its outlook for the full year.

“As expected, our first quarter results show a slow start to the year,” CFO Arno Antlitz said. “A strong March, the solid order bank and the improving order intake in the past months are encouraging and should already have a positive impact in the second quarter.”

Volkswagen isn’t alone with its difficult start to the year. Mercedes-Benz Group AG’s first-quarter earnings, reported earlier Tuesday, plummeted by around a third over model changes in Asia and sluggish demand for EVs.

On Monday, shares of Volkswagen’s Porsche AG declined after the luxury-car maker posted its worst quarterly result since listing in September 2022.

Volkswagen’s brands plan to introduce more than 30 models this year to defend sales in markets including China, where local rivals dominate on electric vehicles. Parts problems recently impacted deliveries of Audis and Porsches in the US.

CEO Oliver Blume is pushing technology partnerships — including in China with Xpeng — and cost cuts to challenge the likes of BYD, Tesla and Stellantis. Volkswagen’s namesake brand, meanwhile, is implementing a €10 billion savings plan.