Volvo's not slowing down, and SUVs are where they see their future.
Following the launch of the new XC60, Swedish marque Volvo has detailed that its SUV push is far from over. The smaller XC40 SUV, which has been spotted testing across the globe, will further the brand’s success in the highly-lucrative compact-premium SUV segment.
The XC40 will be unveiled soon at the upcoming Shanghai motor show in China, and will join the ranks alongside the well-received and critically-acclaimed XC90, as well as the show-stopping XC60 that was unveiled at the still-ongoing Geneva motor show. The XC40 marks a new step for Volvo, as it will be the first time that the marque will offer three SUVs.
“This year with the XC40, it really means for the first time we will have three sizes of whole-model SUVs. That is, I think, the most important thing for this company to talk about,” said Volvo Cars CEO Hakan Samuelsson. “Already today, almost half of our cars sold are SUVs, and with three whole models, it will clearly be above 50%,” he elaborated. He also talked about the financial aspect of things. “Profitability is very good with those cars, so it’s a very important way of growing the company.”
It’s no secret that Volvo’s sales are dominated by the XC60, which has enjoyed the crown of being Europe’s favourite car in the segment. Last year, despite already being billed as an outgoing model, the final models flew off showroom floors at a staggering rate, letting the first-generation model leave on a record sales high. “Right now the top car [in sales]] is the XC60, then it’s the smallest, the V40. Then, it’s the XC90,” detailed the CEO. With two SUVs on that list, the XC40 could very well join the podium of Volvo’s top-three sellers.
Volvo is confident that its SUVs will take the market by storm, as even estate-loving markets like Europe are being drawn to high-riding SUVs despite the practicality-compromise they sometimes pose. “The V90 is still a very popular car line, but also in Europe I think SUVs are also taking a share from the wagon [market],” Samuelsson said. “What we have seen in the US is happening in Europe as well. An SUV has basically the same functionality but you sit a big higher, feel safe, have good visibility – that’s what you hear from customers driving an SUV. So it’s a natural taste if you want to have an estate or an SUV, and price wise there is no big difference either.”
Talking about the production plans for the XC40 & XC60, the CEO detailed the company’s plans to assemble both the XC40 and XC60 in China, as their facility in Chengdu bears the sort of capacity that can satisfy global demand. “We are doing that,” he said. “Today’s S60 is built in China and then shipped to the US. There will also be the XC60, as we need more capacity. We have Ghent (their manufacturing facility in Belgium), and we have Chengdu, so both of them have to serve the global demand. And they will be absolutely equal, and this car [XC40] will be built in Chengdu.”