Europe’s largest car rental firm Sixt SE is continuing to reduce the number of electric vehicles in its fleet, Bloomberg reports.

It comes as it warned of lower resale values would keep it from meeting its annual targets.

In January, Sixt and Stellantis, the world’s third-largest automaker, struck a deal for the purchase of up to 250,000 vehicles for Sixt’s fleet across Europe and North America.

Asked about higher volumes with buybacks linked to its partnerships with Sixt and Ayvens at its recent Q1 2024 Shipments and Revenues call, Stellantis’ CFO Natalie Knight said, “From a revenue line […] you don’t see it as quickly in your results.”

Sixt posted a €27.5 million ($29.6 million) loss in Q1 2024 and cut its annual forecast for earnings before taxes to as low as €350 million, down from €400 million previously.

It warned of “significant tailwind” for the second half of the year and beyond but said its counter measures included the tightening of the fleet to optimise utilisation and improving fleet costs via increased rotation.

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Car rental firms have come under increased pressure as EV demand slows, in additional to pricing wars initiated by Tesla.

In December, Sixt says it plans to phase out Tesla EVs from its fleet because of lowered resale values link to its price cuts.