Investing.com -- Volvo (OTC:VLVLY) Cars (ST:VOLCARb) has reported first-quarter operating earnings that were below expectations, citing foreign exchange headwinds and weaker contract manufacturing sales.
The automaker announced that earnings before interest and taxes slipped to 4.7 billion Swedish crowns in the three months ended in March, an 8% decline from the corresponding period last year. Consensus forecasts had called for 5.93 billion Swedish crowns, Reuters reported, referencing JPMorgan estimates.
Shares in the Swedish group fell in early European trading on Wednesday.
But Chief Executive Jim Rowan said that demand is expected to "remain robust" in the coming quarters, in line with the company's guidance for full-year sales volumes growth of at least 15%.
The firm added that it anticipates that the number of fully electric cars in its newly launched vehicles will be "considerably" higher than in 2023. Rowan said that Volvo Cars is confident that electric vehicle margins will continue to move higher despite recently flagging consumer demand for EVs and increasing costs related to the development of the technology.
Battery-electric vehicle gross margins came in at 16% in the first quarter, up from 13% in the prior quarter.