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Volvo's Big Plans for After the New 2011 S60

Volvo's Big Plans for After the New 2011 S60

Michael Larner

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With the new 2011 Volvo S60 positioned to be the “naughty” Volvo, and hopefully a big winner for the stereotypically “safe” brand (in every sense of the word), it would only make sense for the manufacturer to try and capitalize on that momentum. And that means that some big changes are being planned at Volvo.

Now that Geely of China has purchased the company from Ford Motor Co., the new management team is free to develop their own strategy that represents a radical departure from the Ford plan.

CEO of Volvo Cars of North America, Dan Speck, has said that the Volvo S40, currently the smallest Volvo sedan, will be phased out within the next two years, primarily because it is too similar in size to the new S60 (due to arrive this month). The management team is considering introducing a smaller vehicle that would compete against vehicles like the BMW 1-Series, as that would enable Volvo to compete in the growing small luxury market, and widen the gap between their large and small vehicles.

Although sales of the 2009 S60 sunk more than 30% from the previous year’s sales of 8,966 units, Speck expects Volvo to sell between 15,000 and 25,000 units of the new S60 annually. After all, its daring new styling, sleek looks, and luxury features make it much better suited to competing against the BMW 3-Series, Mercedes-Benz C-Class, Lexus IS, Infiniti G, and other luxury sedans.

Volvo’s strategy also includes developing unique platforms for the S80 sedan and XC90 crossover, which are scheduled to be redesigned within the next two years. In addition, the manufacturer plans to phase out their iconic station wagons in the United States, with the V70 wagon disappearing after 2011, and the smaller V50 ceasing production two years later. To fill the gap created by discontinuing the station wagons, Volvo is considering adding a smaller crossover to the lineup to compete with vehicles like the BMW X1. As Speck puts it, “there will be more X1 counterparts in the luxury segment.”

To sum up Volvo’s plan (as it currently stands), we can start saying our good-byes to the V70 and V50 station wagons, as well as to the S40 sedan. But don’t be too sad, as a newly redesigned S80 sedan and XC90 crossover are in the works, and a new small sedan and small crossover are being considered as future products.

[Autoweek]