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The first ever Volvo XC40 compact luxury SUV could well be a game-changer for the Australian arm of the Swedish brand, as the market increasingly moves towards small SUVs.

The all-new Volvo XC40 will be the brand’s first ever compact SUV, giving it a rival to the likes of the Audi Q2 and Q3, BMW X1, Mini Countryman and Mercedes-Benz GLA. Volvo has teased potential customers with a concept model of the new compact crossover, the Volvo Concept 40.1

Currently – on a global basis and in Australia – the larger Volvo XC60 is the brand’s most popular model, outselling all other vehicles in the range. In Australia it accounts for about one-third of all sales, and in 2016 the XC60 saw its best sales year ever, despite the all-new model launching.

Volvo Concept 40.1 front seven-eights

Greg Bosnich, Volvo Australia director of PR and corporate communications, said the fact the XC60 has been so strong for the brand means the XC40 could indeed prove to be the new big-seller for the Chinese-owned Swedish marque.

“The potential is that the all-new XC40 could be bigger than the XC60 in terms of sales, both locally and globally,” he said. “That’s by far the fastest growing segment.”

Bosnich said that the allure is especially strong for the company, as it aims to win new buyers that may not have considered a Volvo before.

volvo-xc40-spy-18-rear

“There is significant potential – it is all-new business; we don’t have a vehicle in that segment.”

The XC40 will be the first car in the ’40 series’ with it launching globally later this year and arriving in Australia in the second quarter of 2018.

After the XC40 it is expected that there will be a new V40 hatchback and possibly an S40 sedan. Currently, the V40 is the brand’s third-biggest selling vehicle, behind the XC60 and XC90 – so it appears pretty clear that a XC40 may be the answer to a question that buyers will increasingly be asking in the coming years.

Volvo Concept 40.1 profile

The all-new XC40 is set to be built in Chengdu in China, as it shares a platform with Volvo’s parent company Geely.

The new model is set to be offered with a range of four-cylinder turbocharged drivetrains, and an all-new three-cylinder petrol.

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