What's On the Horizon for Volvo?

October 4, 2010

Now that it's owned by Geely and not by Ford, what's in the future for Swedish automaker Volvo?

One thing is certain--change is coming, now that the automaker is no longer owned by Ford. After acquisition this past summer by Zhejiang Geely Holding Group of China, it’s no longer a given what future products Volvo will offer.  As reported in AutoWeek, Ford, which had a base plan for Volvo utilizing three platforms, is out of the picture. Volvo’s future product offerings may only require two plaforms in order accomplish its long-term goals.

What does that mean for consumers?

The result could be some pretty exciting products – even in the near term.

The CEO of Volvo Cars of North America, Doug Speck, told AutoWeek that the first two products the new Volvo management is looking at – although they haven’t made a final determination yet -- are a new small sedan addition to go up against the BMW 1-Series and a compact crossover aimed squarely at the BMW X1.

Volvo’s existing S40 will be phased out over the next couple of years to make room for the proposed new small sedan, which will be smaller than the S40.  The automaker wants to maintain sufficient size gap between products and having two sedans so close in size is not cost-effective and produces too much overlap for consumers. Volvo also wants a small luxury crossover to effectively compete in this hot and growing market.

As for the larger vehicles in Volvo’s product lineup, Speck indicated that the S80 sedan as well as the XC90 crossover will each get their own platforms. This will occur as the two products are redesigned, again likely during the next couple of years.

A big motivating factor for the S80 replacement design is the fact that the large  sedan segment is huge in China, and large luxury sedans are becoming even more important.

The XC90 crossover, on the other hand, is intended to fill the gap once Volvo discontinues station wagons in the U.S., beginning with the elimination of the V70 wagon, which won’t be sold after the end of the 2011 model year. Speck further indicated that the smaller V50 wagon will cease within two years after S40 is dropped.

The brand-new Volvo S60 luxury sedan, which was just introduced, is expected to account for 15,000 to 25,000 annual sales. This compares with 5,895 in 2009 and nearly 9,000 in 2008. The platform, according to many reviewers, was quite aged and in need of redesign. As it is, the just-introduced and completely redesigned Volvo S60 is on the short list of contenders for the North American Car of the Year (NACOTY).

So, out with the old Volvos, in with the new – and those under consideration. We’re all for product differentiation, and maybe the new blood transfusion through Volvo’s new management will be just the right medicine to jazz up Volvo’s product lineup. And that’s before any of the new product designs mentioned here even get off the ground. So, there’s a lot for consumers to look forward to in the coming years from Volvo.


[AutoWeek, Volvo]

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