Volvo is lauding the success of its China organisational structure as the country became its number one market last month, posting rising sales up 49% compared to last year.

"Why we are getting territory back in China is we finally got an organisation in place that can deliver," a Volvo spokesman told just-auto in Gothenburg.

"We had a huge number of new dealers coming in when we were bought by Geely and it takes some time before everybody understands what it is we are going to sell, how we are going to sell and how to communicate the brand.

Volvo's Chengdu plant in south west Sichuan province will start producing the S60L in the fourth quarter of this year, while the company's newly inaugurated plant in Daqing, in North China's Heilongjiang province, is anticipated to begin production by the end of the year.

The first phase of the Daqing plant is designed to produce 80,000 units a year while a second phase will have an annual output capacity of 300,000 units.

Europe continues to remain problematic for many auto manufacturers, although Volvo is bucking the trend somewhat with for example, the Netherlands, where the V60 Plug-in Hybrid and the V40 models are selling well, while the UK, Switzerland and Spain are seeing growth with V40 and V60 vehicles.

"Everybody knows the whole European market for cars is going down and of course, we have had our share of it," said the Volvo spokesman. "It is not only a matter of Volvo coming back, it is to what extent the market in Europe for cars come [s] back.

"Everybody is looking for every possible sign there is to determine, is this changing? The positive thing for us is we have a very fresh model portfolio - in May we started six significantly upgraded models that are starting to sell well.

"That is what is behind our better sales - after all this business is about products."