Last week’s post briefly touched on the initial design ideation for Volvo’s next-generation small cars which would replace the Swedish automaker’s compact S40 sedan and V40 station wagon. Those quick sketches and their accompanying descriptions, nearly one hundred in all, as I recall, were reduced to fit in an A4 portrait format and then bound into handy reference books for Volvo management to peruse at their leisure.
We instinctively knew that the compact-car segment was beginning to fragment, not least with the addition of smaller sport-utility vehicles such as the Honda CR-V and Toyota RAV4. Thanks to our new Ford connections, we learned of the Blue Oval’s compact unibody Escape sport-utility (Maverick in Europe) and Land Rover’s compact Freelander SUV, both in late-stage development for U.S. introduction in the 2001 and 2002 model years respectively.
It seemed that a market opportunity could exist for a Volvo entry positioned above the Asians and domestics but below the compact Land Rover entry. And after all, an “all-activity vehicle” was one of the avenues explored by Volvo design teams and enshrined in the aforementioned reference books…
The 1999 Honda CR-V and Toyota RAV4. By this time, the Asians had joined the four-door compact SUV segment pioneered by the ’84 Jeep Cherokee. (Sources: www.kbb.com (CR-V); www.carsdirect.com (RAV4).
Also, at about this time, I had the opportunity to briefly test-drive a V40 hybrid. It was never confirmed, but I guessed that Toyota (and Volvo) transmission supplier Aisin Warner may have had a hand in that vehicle. Compared to my standard company-car V40, the hybrid felt more substantial, likely due to the added weight of its motor/generator. It was also quieter (not least when its automatic start/stop feature kicked in) and its acceleration was acceptable. The V40 hybrid was surely no sports car, but what better way to put our (R&D) money where our mouth was. Volvo had then begun to promote “environmental care” as an added brand core value, a bit disingenuously I thought, since aside from the mid-1970s introduction of the Lambda Sond oxygen sensor and three-way catalytic converter, I felt there was precious little in the way of recent environmental innovation that we could justifiably point to.
The Lambda Sond technology was a world-first in the mid 1970s, but by the late ’90s I felt we needed additional “environmental cred”.
While Volvo wouldn’t be unique in developing an SUV from the new C-segment platform under development at Ford, Mazda, and Volvo, the addition of a hybrid version would give Volvo a tangible brand differentiator in a growing market segment. (At the time, I was unaware that Ford planned to introduce a hybrid-drivetrain version of its first-generation Escape compact unibody SUV for the 2005 model year. We had proposed hybrid versions of the upcoming S40/V40 successors, but they were shot down by Ford’s bean-counters because they didn’t achieve the required profitability.)
Ford’s 2005 Escape Hybrid borrowed Toyota technology. (Source: https://motorweek.org)
So, we proposed the addition of a sport-utility to Volvo’s developing P1X new-car program. With the blessing of my Marketing boss, we also proposed that the compact SUV should be the first new-generation 40-series Volvo to reach series production, instead of the sedan and estate body-styles.
The introduction of a sport-utility as the first member of this new generation of Volvo compacts would enable the brand to make a real impact in a growing market segment without seriously affecting sales of the existing models. While the V40 was popular in Europe, the S40 was forecast to take the lion’s share of compact Volvo sales in North America after their 2000 model year stateside introduction. If the higher-per-unit profit SUV cannibalized some potential V40 sales, it would be no big deal.
Adding a compact SUV would also dovetail nicely with the planned 2003 model year addition of Volvo’s mid-size XC90 sport-utility, giving the brand credible entries at both ends of that exploding market segment. We theorized that our P1X sport-utility could share its platform with the successor to Land Rover’s first-generation Freelander, potentially aiding both brands in terms of cost-sharing and economy of scale.
The 2001 Volvo Adventure Concept Car and the production 2002 XC90. Sources: www.caranddriver.com (ACC); https://en.volvo-club.cz (XC90).
Additionally, Volvo could benefit from Land Rover’s off-road expertise, while the Brits would take advantage of Volvo’s reputation for safety. Dimensionally, the two vehicles could easily be accommodated within the C-platform’s constraints, and bringing a compact SUV to market first would improve the total project’s profitability at an earlier stage, thanks to its higher forecast sales volume, building a stronger foundation for the other bodystyles which would be added later in the platform’s cadence. Would the Premier Automotive Group planets align?
The Land Rover Freelander was not to be our partner in entering the growing compact SUV segment in the U.S. The right decision, as it turned out. (Source: https://media.landrover.com)
Sadly, this radical proposal was quickly shot down by the execs on both sides. While it was generally agreed that the SUV-first strategy might be perfect for North America, replacing the current S40 and V40 was rightly seen as a higher priority for Europe, so those two body-styles remained on the fast track for production, starting in mid- and late-2003 respectively. Component sharing with the Freelander wouldn’t have worked out well, either; as it happened, Jaguar Land Rover dropped the first-gen Freelander from the U.S. market after the 2005 model year. It was eventually replaced by the LR2 which debuted for model year 1998.
Even after my return to the U.S. in 2001, Volvo Cars of North America continued to advocate for the addition of sport-utility (and sport-coupe) variants on the C-platform, restating a business case suggesting that if introduced in late 2004, a P1X-based SUV could quickly become the platform’s best-selling variant, adding nearly $140 million in profit in the U.S. alone by the close of 2006.
In the world of automotive product planning, as in most occupations, there will be successes and failures (whether of commission or omission). You’re a star if you manage a .500 batting average. Volvo did eventually add a sporty three-door hatchback to its compact-car program in late 2007, after first revealing its Safety Concept Car teaser at the 2001 Detroit Auto Show.
The 2001 Safety Concept Car featured (somewhat) see-through A-pillars. Its resemblance to the production 2007 Volvo C30 is not coincidental. The see-through A-pillars, unfortunately, were deemed not feasible for production. (Sources: https://teknikensvarld.expressen.se (SCC), https://roadtestdotorg.wordpress.com (C30).
And it took more than twenty years for our vision of a compact Volvo sport-utility to reach fruition, as it finally did when the XC40 was added to the lineup for the 2018 model year. A battery-electric version was added two years later.
Volvo’s first compact sport-utility, the XC40. (Source: www.caranddriver.com)
Amazingly enough, despite the passage of two decades, the production car didn’t stray too far from our original proposal.
With the benefit of twenty years’ hindsight, the similarities are obvious.
Sometimes it helps to have a long time horizon in this business…
(Featured “Volvo Safety Pin” image from Volvo Cars Design hardcover book, 2005)
The PAG under Nasser was disastrous. It was also about the same time that flat rate warranty times were beginning to be slashed without any actual time studies, and coincided with the Firestone tire debacle. Replacement of actual Ford engineers at training centers with hires from Wyotech and the like. Definitely felt like a corporation without a focus, even at the dealership level. The Lincoln LS had rave initial reviews, but quality problems soon showed up, especially with the automatic transmission. BTW the Ford and Toyota were developing a similar hybrid system at about the same time, and rather than get into lawsuits over patents, agreed to cross license the technology.
I’m not surprised that Ford vetoed a Hybrid Volvo SUV hitting the market before the Escape, since they did spend a bit of “air time” on how it was the first Hybrid SUV. (Then of course dropped it from the line up until the current generation). I could also understand why they wouldn’t want money spent on designing, testing and tooling for a second hybrid system. What I don’t understand was why they didn’t want to use the system they had developed in the Volvo with a later introduction date after all they did briefly offer a Tribute Hybrid after the Escape (and Mariner) had been on the market for a while.
As Exfordtech noted Ford didn’t “borrow” Toyota’s tech, they agreed to a cross licensing agreement where they had access to each other’s hybrid patents both those that existed at the time of the agreement and at least near term future developments.
While the Ford unit was built by Asian the architecture was completely different between the two. The Toyota system used a single axis and single reduction between the traction motor and the wheels the Ford system used a dual axis and a compound reduction between the traction motor and the wheels. That allowed the Ford unit to be shorter despite having a larger traction motor and allow a higher engine off vehicle speed. Toyota now uses the dual axis, dual reduction architecture.
The other interesting thing about the first generation Ford system is that the case provided a provision for a clutch to lock the starter/generator and provide a fixed ratio 100% mechanical path between the engine and wheels. Not sure why they abandoned it so late in the game that the provisions for it made it into the case. The current Honda dual motor hybrid system does include a clutch to lock the starter/gen to the traction motor to provide a 100% mechanical path at higher speeds, that they claimed resulted in a 4% increase in hwy MPG vs 100% series operation used at lower speeds.
The LR Freeloader came and went so quickly here in the Midwest that I was surprised as RR/ LR models stuck around for decades. The Ford, Mazda, and Volvo trilogy was so apparent in my C30 that anytime a part was replaced I never had more than a 33% chance of guessing the manufacturer of the part. The C30 T5 was such a fun car and I miss it often. After driving my in-laws 09 Mazda 3 hatchback the C30 was a significant upgrade as I expected due to the substantial price difference. The Mazda and Volvo shared shared the same platform but the Volvo felt much more solid. Closing the doors made a solid and reassuring thud sound.
…and once upon a time, there was a Ford Focus RS with Volvo’s 2.5 liter, inline-five turbo engine (300+ hp).
It’s certainly a bit curious as to what took so long for Volvo to have a compact SUV.
Very Interesting….
I have three Volvos 240dl (2) and a 940. All station wagons !! Go and go and go and go
over 250,000 on all
Another great chapter. Glad to see the C30 mention – had mine 12 years now and still love it.
I’ve driven other P1 cars, mostly the Mazda 3 and the difference in “feel” between the two is significant. As mentioned in a comment above, the Volvo feels much more substantial and solid – no doubt due to the add’l safety reinforcement in the structure.
I’d be interested to know what the Volvo folks thought about Ford using their five cylinder turbo in the Focus RS.
I wonder how they felt about using a Ford 2 litre turbo in their lovely-looking, sweet-driving XC60, from about 2012-2015 (in this country). Suspicious, I’d warrant. They’d have had cause.
I know how my sister felt: broke. The XC60 was (and is) pricey hereabouts when new, yet the engine in hers had expensive coolant system issues by 60K miles, and that notorious Ford DCT transmission (by ZF, I think) shat itself to the tune of $8K AUD at 85K miles. Needless to say, they will never consider a Volvo again.
The new Volvo XC40 is nice package for a small SUV, increasingly I notice its EV version getting popular around Central Jersey I live.
Wonder if the author in the future article shares his thoughts on the reaction of Chinese Geely bought Volvo just the 2008 financial crisis. What is the impact? Positive or negative? Geely Chairman Li is some kind of car nut, but manages such established business has to be challenging. On surface Geely mostly leaves Volvo alone except pumping money.
The rumor in China is that Chairman Li has plans to make Volvo a direct challenger to German automakers Mercedes-Benz , BMW and Audi. But it didn’t work out. Well off Chineses stick to ABB Audi, BMW and Benz). That was partial reason he invested in Daimler stock. Geely now is the largest stockholder of this German company.
I wonder why the success of the XC90 didn’t hurry Volvo on to get a compact one out? Some sort of management blind spot, perhaps? Perhaps, more likely, it wasn’t obvious there’d be a “premium” small SUV market then.
Still, any Volvo fancier should be relieved that nothing based on a Freelander occurred. That car was an absolute shocker, so bad the 2nd gen was just “LR2” in USA, though it wasn’t a million per cent better. (Cue a slightly moany voice saying, “Pure rubbish, I drove my 1st gen Freelander from Land’s End to John O’ Groats every Tuesday for 10 years, and it never even used any petrol”, but I digress).