Production will be expanded at its Ghent manufacturing plant and Volvo Cars will add XC40 production capacity at its Luqiao plant in China in the first half of next year, underlining the popularity of this year's European Car of the Year.

In addition, the company has also announced today that it will capitalise on the popularity of its new smaller models with the introduction of new models on its Compact Modular Architecture (CMA), replacing the current V40. "The XC40's success has surpassed even our highest expectations," said Hakan Samuelsson, President and CEO of Volvo Cars.

"The small sport utility vehicle segment is the fastest-growing segment in the industry now, and with these additional CMA-based models we expect to benefit further from that growth." The coming new models based on CMA will include fully electric vehicles and will be sold globally in all major regions.

The XC40 was launched in late 2017 to global acclaim and was the first ever Volvo to win European Car of the Year in March of this year. It's also the first model on Volvo Cars' new CMA vehicle architecture. In March, Volvo Cars announced it will produce cars for its new sister brand Lynk & Co at the Ghent plant. Like the XC40, the first Lynk & Co model is based on CMA.