The Volvo XC40 will be the second model created out of the Swedish brand's new C-segment Modular Architecture (CMA) following the next-generation Volvo V40 due around 2016.
Volvo senior vice president Lex Kerssemakers confirmed details about the new platform at the Paris motor show, which is being developed in conjunction with Chinese parent Geely as a highly flexible small car architecture that the company wants to spawn a new V40 and first small SUV to rival the Audi Q3, BMW X1 and Range Rover Evoque.
"It's a very natural choice for Volvo," Kerssemakers says of a future Volvo XC40 model.
"You then have a very nice lineup: XC90, XC60, XC40. Small SUVs, that's where you see the growth. You see it overall downsizing, so I see big business in the future as it is now, but continuing for the C [segment] premium end of the market. We see that shift, we see sedans going into SUVs."
The senior vice president stresses that the first job is to replace the V40 sometime in 2016, however, while the XC40 is expected to follow in 2018.
"The major task is to replace the V40 ... [but] the platform is developed in such a way that it can carry [physically] high cars and low cars, so we are very flexible. Of course we are looking for 'top hat' expansions to increase the leverage on the platform."
Both V40 and XC40 will be available as a plug-in hybrid, too, as Kerssemakers eventually predicts "25 per cent of our total volume is filled with plug-in hybrids, depending on the country."
"We will have plug-in variants because we strongly believe in plug-ins ... [for small cars] mild electrification, smaller battery packages, we have the modularity to do it," he adds.
"If there is a market for electric cars, whether two or three cylinder as a range extender, we are able to put it in, so we technically sure we can make that change [on CMA]."
Kerssemakers even responds to the suggestion of a new-generation C30 light hatchback with "yes, we are free to do whatever we want."
"We are prepared for a wide range of products," he adds.
Volvo makes no secret that its modular platform architectures SPA (which debuted on new XC90, with the next S60, V60, XC60, XC70, and S80 to follow among others) and CMA are initially a huge expense. A relatively small maker such as Volvo also doesn't have the ability to amortise the cost over as high-volume range as, say, Volkswagen.
"It is a very thin equation, but it is what it is, we had to take a decision [costs of CMA and SPA]," admits Kerssemakers, who adds that it will take two generations of Volvo cars to cover the costs.
"For the lower [CMA] platform, we looked around, what can we use, but we decided to do it within the group," the senior vice president says of its relationship with Geely.
"In Gothenburg we have created a separate engineering company with Volvo engineers, with Geely engineers ... Geely has very high ambitions, they also needed a more premium platform, so then we said 'you know, let's do it together, and let's also make that platform scalable' so Geely can use it and we can use it."
By 2020 the only just-released XC90 will be the oldest vehicle in the Volvo lineup as the Swedish brand aims to accelerate new model development.