Volvo, the Swedish automaker reported a profit in the first quarter on higher volumes and sales. For the first quarter, Volvo Car Corp. reported operating earnings before interest and taxes of 640 million SEK, compared to the same quarter last year.

The company noted that the increase in earnings was primarily due to improved sales, marketing efficiency and a controlled increase of costs. Retail sales for the quarter increased 13.7% to 106,827 units from the prior year period.

For the full year, the Swedish carmaker reported operating earnings before interest and taxes of 2,340 million SEK. This was an increase of 7,525 million SEK, when compared to the prior year period.

The improvement in yearly earnings is attributed primarily to higher volumes and favorable net pricing, partially offset by increased costs. Revenue for the full year was 113 billion SEK, a 17.4 billion SEK increase from a year ago period.

Sales in China increased 36.2% and sales in Nordic region increased by 29%, compared to 2009. In Europe sales increased 10.4% and market share improved by 0.14% points to 1.2%. On the other hand, sales in the U.S. decreased 12.2% to 53,952 units, compared to 61,246 in 2009.

The company noted that the increase in sales is mainly driven by an excellent product portfolio and strong market strategies including successful launch of the all new S60 and V60, continued global success for the XC60 crossover, Volvo Car Corporation’s best selling model and strong demand for Volvo Car Corporation’s range of fuel efficient DRIVe vehicles in Europe.

Looking ahead to the full year 2011, the company expects sales to continue growth. The company will increase the production in both the Torslanda plant and Gent plant.