Volvo expects SUVs to account for an even higher percentage of the automaker's global sales after it adds a model below the XC40.
"With the addition of a smaller SUV it will probably be higher," CEO Hakan Samuelsson told Automotive News Europe. "Maybe it will be three-quarters SUVs in the future."
He didn't give a time frame for when the SUV share would reach 75 percent. Through 11 months, SUVs accounted for 71 percent of Volvo's global sales, up from 63 percent during the same period last year.
Volvo confirmed in October it would build a small full-electric SUV, which will be a crucial part of its effort to get half of its global sales from battery-powered vehicles by 2025 and potentially become an electric-only brand by 2030.
"There is a clear trend toward small premium SUVs. It is a very successful segment, Samuelsson said.
The model, which Samuelsson said would wear the XC-badge, will use the Sustainable Experience Architecture (SEA) that Volvo helped parent Zhejiang Geely Holding develop.
"To really have the right cost structure on that we have to share the architecture," Samuelsson told ANE. "We have a possibility to have a really competitive car in that size, also when it comes to profitability."
Volvo hasn't said when it will start selling the small SUV.
Lynk & CO, a joint venture between Volvo and Geely Automotive, has said its SEA-based car, the production version of Zero Concept, will be launched next year.
Volvo will launch one electric car each year starting this year with the XC40 Recharge.
The automaker has not revealed the full cadence of those debuts, although Samuelsson said last year the full-electric version of the new XC90 flagship SUV is slated to arrive in 2022.
'Streamlined body'
Samuelsson said Volvo's full-electric car for 2021 will be based on the same CMA underpinnings as the XC40 Recharge "but with a more streamlined body."
He declined to provide further details, although he confirmed that the new model would not be a successor to the recently discontinued V40 compact hatchback, which competed in a price segment below where Volvo wants to be.
"For Volvo to be profitable we need to focus on higher price, more premium car segments," he said. "For customers who want a lower priced cars we will recommend that they have a look at Lynk & CO. They will position their cars slightly under us."
Lynk & CO, which is a joint venture between Volvo and Geely Automotive, launched its first model for Europe, the 01 compact SUV, in September. The brand has been selling vehicles in China since 2017.
When asked whether Volvo is also considering an SUV above the XC90, Samuelsson said, "I would not rule out a somewhat bigger SUV."
He said, however, that such a model would have to undergo some changes to align with Volvo's electric push.
"If we do that [add a larger SUV], we need to do it in a sustainable way. We need to make sure such a vehicle will be optimized for electrification. I think what will happen In the future is that SUVs will need to be more aerodynamic."
