Geely-owned Volvo Cars has reported an operating profit of SEK3.5 billion (USD318m) for the first three months of the year, up 11% year-on-year. It said the increase was mainly driven by strong demand for the XC60 and 90 series model ranges.

However, Volvo Cars also reported an operating profit margin of 7.3%, down from 7.5% last year. It said profitability was partly offset by costs related to the launch of the 90 series and XC60, as well as continuous investments in new technologies and a rising number of employees.

Since the first quarter of 2016, Volvo Cars has added 5,000 employees, bringing the total global workforce to 33,000.

Global retail sales increased by 7.1% to 129,148 cars in the January-to-March period, resulting in a first quarter revenue of SEK47.6 billion, up 13% from SEK42.0 billion last year.

"In the first three months we have seen strong demand for our 90 series cars as they reached markets worldwide," said Håkan Samuelsson, president and chief executive of Volvo Cars. "We also unveiled the new XC60 in the first quarter and we expect this car to have a positive impact on sales and profitability."

The Asia Pacific region reported sales growth of 16% in the first quarter to 32,872 cars, boosted by a strong performance in China, Volvo Cars' largest market. In China, sales rose by 18.8% to 23,335 units, following 'strong demand for the locally produced XC60 and S60L models, as well as the XC90 and S90'.

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Sales in the EMEA region increased by 9.2% to 78,820 cars sold, on the back of a strong performance in Sweden, the United Kingdom and Germany. The region continued to see strong demand for the new V90 and XC90, as well as Europe's most popular premium mid-size SUV, the XC60.

The Americas region reported sales of 16,641 cars, of which 13,476 were in the United States. The XC90 remained the best-selling model in the Americas.