Volvo chases young at heart

VOLVO says generational change – and not just in its showroom range – is erasing its damaging “bloody Volvo driver” image in Australia.

Volvo Car Australia managing director Matt Braid said its research showed younger Australian motorists had fewer hang-ups with Volvo, judging the company on the mechanical merits of its products, not the brand image that was often considered staid by older drivers who had not experienced the latest Volvo range.

He said Volvo’s upcoming all-new luxury hatchback, the V40, would help to attract even more younger customers into Volvo showrooms, accelerating the overall appeal of the Swedish car-maker.

Mr Braid revealed that one in every two potential customers who test-drove a Volvo ended up buying one – a conversion rate that he said was at the upper end in the industry.

“Customers who put their bums on the seats are very pleasantly surprised,” he said.

Mr Braid said the unwarranted image of Volvo as an old person’s car was peculiar to Australia, and was perpetuated by the media.

He said the new mid-size S60 sedan and Volvo’s luxury SUVs – the XC60, XC90 and XC70 – had helped to dispel the myth of boring Volvos.

This elevation of the Volvo image would continue with the new V40 – a competitor for entry-level European cars such as the BMW 1 Series, Audi A3 and upcoming Mercedes-Benz A-class – which he described as “a true luxury hatchback”.

Mr Braid said he expected V40 to have a high conquest rate, drawing a new clientele looking to either step up from, for example, Japanese cars, or down from larger luxury vehicles of other European brands.

He said this would have a positive effect on Volvo’s image while also providing Volvo with a new generation of drivers willing to step up through the range over time.

From top: Volvo Car Australia managing director Matt Braid, the Volvo V40 and the interior of the V40.

But Mr Braid said Volvo was not making huge predictions for V40 sales, saying the new model would “add volume and help us grow”, but not massively.

“We are conservative about the extent of the growth,” he said, adding that the market segment facing the V40 was tough, with a lot of fresh entrants.

Mr Braid said the V40 would be well specified, and would not be pitched as a cut-price alternative to German rivals, including the new A-class that arrives in Australia around the same time.

“We will be targeting customers who want luxury, but don’t want to go up in size,” he said.

Mr Braid said that, like all Volvos, the V40 would have a high minimum level of safety equipment in all markets.

He said he expected the V40 to go into local showrooms early in 2013.

The V40 will be sold alongside the current entry level model, the C30 hatchback, which Mr Braid said would become more of a niche model.

The engine line-up, pricing and other details of the Australian V40 range are still under wraps, but the five-door hatchback will not get a new-generation flex-fuel engine under development in Gothenburg.

That engine is designed to take over from the current – and still relatively new – GDTi four-cylinder petrol engines sourced from Ford, which sells them under the EcoBoost banner.

Mr Braid said the new engines were expected in three to four years, and would be scalable in size, cost and performance, from small, super-efficient pint-sized engines to high-performance sportscar powertrains.

The engines will be central to Volvo’s recently announced four-cylinder-maximum engine policy, consigning Volvo’s larger five-cylinder, V6 and V8 engines to history.

The introduction of the new engine range will sever a major link with former owner Ford, freeing up new owner Geely to freely use the same engine technology in China and elsewhere.

Mr Braid said that, while other European car manufacturers were also developing new turbocharged four-cylinder engines, Volvo was the first to publicly state that it would cap its engines at four cylinders across the range, in both petrol and diesel.

He said the new engines would be designed to deliver both fuel economy and performance, and top-end variants would have the power to outperform current large capacity engines while using less fuel.

While the engine line-up has not been confirmed for Australia, the range could be expected to include a super-efficient 1.6-litre diesel and a similar-size petrol GDTi four-cylinder, and perhaps the high-performance 187kW petrol five-cylinder.