Daimler's first-quarter operating profit surged, with higher vehicle prices and strong demand in China powering its recovery from the effects of the coronavirus pandemic.

Quarterly adjusted group earnings before interest and tax jumped to €5 billion in the first three months of 2021 from €719m a year earlier, the German carmaker said today.

That was above average analyst expectations of €4 billion, prompting it to release key figures a week ahead of schedule, it said. The comparable figure in 2019 was €2.3 billion.

"Favourable sales momentum at Mercedes-Benz Cars driven by all major regions, especially China, strongly supported the product mix and pricing in the first quarter," Daimler said.

"Daimler was able to benefit from this development thanks to convincing product substance combined with significant fixed cost reductions," it added.

Volkswagen earlier this week had also singled out China as one of the drivers of a global automotive recovery.

Its Porsche luxury cars business reported a 36% rise in sales in the first three months of the year.

Adding to the positive tone, European car registrations for March bounced back from a year ago when coronavirus lockdowns and accompanying uncertainty across Europe took a toll on sales.

Daimler shares rose by as much as 2.9%, taking them to their highest level in more than five years.

Its shares have gained a third year-to-date, as investors are warming up to electric car strategies outlined by German carmakers.

The global car sector has been hit by a shortage of crucial semiconductors, causing several rivals, including Ford, General Motors and Volkswagen, to cut or adjust production.

Daimler, which has remained largely unaffected so far, did not comment on the chip crunch.

The carmaker, which is due to release detailed quarterly results on April 23, said adjusted industrial free cash flow reached €2.8 billion compared to a consensus forecast for €1.8 billion.