Volvo considers building subcompact-sized model to rival Mini, Audi A1

Article by Anita Panait, on August 21, 2012

Volvo mulls building a subcompact-sized vehicle that would compete against BMW's Mini and the Audi A1. But for this to be possible, Volvo needs to acquire a partner to share the costs as well as get a smaller engine, which could be produced in cooperation with parent Zhejiang Geely of China, Volvo chief executive Stefan Jacoby told Automotive News Europe.

According to Jacoby, premium-car buyers are willing to spend extra even for subcompact-sized cars.  Volvo’s top boos quipped that premium customers no longer define luxury based on the size of the car or number of cylinders, adding that there are other attributes that come into play. Sales of subcompact-sized vehicles in Europe rose by 19 percent to 332,262 units in 2011, according to data from market researchers JATO Dynamics.

Segment sales, however, have dwindled, with the six-month total volume dropping 10 percent to 148,891. Volvo has yet to field a vehicle in the subcompact-sized segment, as its smallest model is the compact V40, which rivals Audi A3 and BMW 1 series.

Jacoby, however, is not in a rush to launch a new subcompact-sized model since the V40 just made its debut last month.  As for priorities, Jacoby said that he intends to bring the Scalable Platform Architecture online and to renew Volvo's core ranges, the 60, the 80/90 and the sports utility vehicles. After accomplishing these goals, Jacoby said he would look into diversification, niches, a sportback and smaller cars.

Topics: volvo

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