Volvo will not be replacing the current 296hp V70R with a new model when then new-generation V70 goes on sale. According to UK's Autocar magazine, Volvo is satisfied with the output of its T6 model and that it has no plans to introduce the 325bhp Yamaha sourced V8 engine used in the XC90 SUV into the new V70.

Volvo has said that it only needs at most two 'R'-badged models at any one time and when the current S60R is discontinued in 2008 a high-performance version of the C30 hatch is likely to be introduced. The new C30R, as it’s likely to be called, will output at least 250bhp and rival the AWD Audi S3 and lesser Golf GTi models in the European hot-hatch market. Volvo could instead launch an S40R equipped with the modular 281bhp T6 engine, which is designed to fit in the S40’s engine bay.

Previous rumors suggested that Volvo was also considering a V8 powered version of the S80 sedan, however, the current transmission system found in the flagship sedan couldn’t cope with the expected 400bhp output. Insiders have also suggested that Volvo might even drop its ‘R’ label, one proposition we find hard to swallow.