Volvo Cars displayed its first compact SUV on Thursday with the launch of its brand-new XC40 model, the newest in a sweeping overhaul of the automaker’s line-up under Geely Holding Group.
Volvo will look to emulate the success of its XC90 and the popular XC60 SUVs, which have put it on course for a straight fourth year of record sales.
Since Geely Holding Group purchased Volvo from Ford in 2018, it has been successful at competing larger competitors such as BMW and Daimler’s Mercedes-Benz with new, more upmarket models.
SUVs have been growing in popularity recently and are anticipated to compromise nearly half of all sales within the C-segment by 2020, data from IHS Markit reveals, compared with simply 20 percent a decade previously.
“The XC40 is our first entry in the small SUV segment, widening the appeal of the Volvo brand and moving it in a new direction,” CEO Hakan Samuelsson stated.
Produced at Volvo’s plant located in Ghent, Belgium, the XC40 is a direct rival to the Audi Q3, BMW X1, Mercedes GLA and the newly launched Jaguar E-PACE.
“The XC40 is going into a crowded sector, however it’s a segment that’s still growing,” stated Ian Fletcher, an automotive analyst at IHS Markit.
Volvo will be aiming to attract clients looking for a high driving position, functionality and muscular appearances of an SUV however with modest off-road abilities and much better efficiency.
“Volvo is ploughing its own furrow and attempting to provide an interesting option to the German automakers,” Fletcher stated.
“This will attract city dwellers, individuals trying to find some aspects of an SUV but with the cool Volvo styling.”
China is anticipated to be a substantial market for the XC40 along with Europe, particularly Volvo’s home market in Sweden.
It is also anticipated to do well in the United States, where Volvo has seen a revival after a few years in the doldrums, Fletcher stated.
Fletcher sees the XC40 selling some 100,000 units in 2018, approximately half the expected deliveries for the Audi Q3 and the BMW X1, however over around 60,000 Jaguar E-PACE.