DOUGLAS A. BOLDUC

Volvo exec says risk factor for XC60 exceeds XC90

Production of the new XC60 started Wednesday at Volvo's plant in Torslanda, Sweden. The first customer-bound car, shown, was a white T5 Inscription variant with all-wheel drive. It rolled off the assembly line just before noon.
Douglas A. Bolduc is managing editor at Automotive News Europe.
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Volvo's r&d boss says the new XC60 is even more of a high-risk model than the second-generation XC90.

“The last years of its life cycle the XC90 wasn't really up to the competition of the other premium brands,” Henrik Green, who replaced Peter Mertens as r&d chief at the Swedish brand five months ago, told a small group of journalists this week at the company's headquarters in Torslanda. “It was like a dinosaur and it, maybe, traded for half the transaction price of the competition given the age of the car [it was sold from 2002 until 2015] … It wasn't a make-or-break model for the company.”

Green says the stakes are much higher for the second-generation XC60, which started rolling of the line at the factory here on Wednesday.

The new car is crucial because it succeeds a model that accounts for huge chunk of its profits, about 30 percent of the automaker's global sales and ranks as Europe's No. 1 selling premium midsize SUV, ahead of model such as the BMW X3 and Audi Q5.

“This is a completely different ballgame because the XC60 is our most profitable car. It's our biggest volume car in all our markets," said Green, who has worked for Volvo for 21 years. "We need to replace that with a very competitive product. The new one has to deliver. The risk is much bigger.”

You can reach Douglas A. Bolduc at dbolduc@crain.com.

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