BMW remains on track for slightly higher sales this year despite a dip in demand in the first quarter, including in the Chinese market, the German carmaker said on Tuesday.

BMW said it delivered 588,138 vehicles in the first quarter, down 1.5% on the previous year, while electric vehicle (EV) sales rose 83.2% year on year to 64,647 vehicles.

By region, BMW only saw sales growth in the United States, with an 11.4% increase to 89,750 car sales.

Sales in China fell 6.6%, but the company said the Chinese economy was expected to stabilise over the course of this year.

A 1.9% fall in European sales was attributed largely to an export and production ban in the Russian market, where Chinese marques are benefiting from the exit by Western automakers.

Volkswagen (VOWG_p.DE) also saw its group deliveries fall between January and February, but recorded growth in China as well as in North America.

BMW remained confident about its 2023 guidance despite a “challenging business environment”, the company said in a statement.

“The BMW Group is on track for slight sales growth in the full year 2023,” said Pieter Nota, management board member responsible for customer, brands and sales.

“The main growth drivers in 2023 will be fully-electric vehicles and models from the high-end premium segment,” he added.

BMW and its competitors are pushing to switch towards electric models to remain competitive and meet climate targets ahead of the 2035 phase-out of CO2-emitting cars in the European Union.

Electric vehicle sales in BMW’s core brand more than doubled in Q1 year on year to 55,979 units.