Driven: Volvo sees opportunity with S60

VOLVO Car Australia (VCA) has high hopes for its new-generation S60 sedan and V60 wagon, which have re-entered the shrinking mid-size passenger car segment to attract new customers to the Swedish prestige brand.

Speaking to journalists this week at the S60 national media launch in South Australia’s Barossa Valley, VCA managing director Nick Connor said there is still plenty of sales volume to be had with mid-size cars, noting that everyone is a target of the all-new models.

“The view of the industry is that mid-market sedans are in decline, it’s a tough segment of the market,” he said.

“A number of people have said to me, ‘Why is Volvo bothering with this? You’re so good at SUVs. Why don’t you just stick with what you’re known for?’ Well, the reality is we’ve also sold a hell of a lot of sedans around the world over the years.

“Yes, the market has been in decline here, but sedans still account for approximately a third of the Australian marketplace.

“And we know with the SPA platform, we have a fantastic base on which to build new product. If you look at S60 and see a fabulous car it is, we genuinely believe we can pull people away from other brands.

“Yes, premium brands are important to us, but it’s also important to pull people up from the semi-premium and indeed the volume brands to Volvo for the first time.”

Mr Connor conceded that convincing buyers to make the switch will not be easy, but he believes the right plan is in place to make it happen.

“It’s tough in this market to say to people, ‘We want to sell a premium sedan.’ We don’t have a reputation for sedans, let’s be honest, particularly mid-market sedans,” he said.

“I think we really have to try and cut through here. I think with S60 and the tactics we adopted, we will actually do that.”

One such tactic is careful market positioning, with both body styles available with three uniquely styled grades – entry-level Momentum, mid-range Inscription and flagship R-Design.

A T5 2.0-litre turbo-petrol four-cylinder engine is offered in all of them, while the range-topper can alternatively be specified with a T8 plug-in hybrid powertrain.

The T5 Momentum kicks off the sedan line-up from $54,990 plus on-road costs, while the T5 Inscription costs $6000 more and the T5 R-Design another $4000. The T8 R-Design is further upstream at $85,990.

Wagon versions of these four variants command a $2000 premium.

The S60 and V60 starting prices undercut those of the equivalent Mercedes-Benz C-Class, BMW 3 Series and Audi A4 variants by about $15,000, which is a position Mr Connor said he pushed hard to achieve.

“We fought quite a long and quite a hard battle in many ways with our colleagues in Gothenburg to get the pricing that we have got with S60 and V60,” he said.

“We really want to try and put an offer in the marketplace that is visually attractive to the broadest possible range of customers.

“Our tactic is not to price high, throw a lot of variable marketing and discounting at the car to bring the price down and say, ‘Save $10,000, $15,000.’ (Instead), we’ve gone with a really strong price point.

“And clearly dealers have the ability to negotiate – and no doubt they will – but we try to be as aggressive as we can sensibly be in the marketplace, so that we can say to a broad range of customers, ‘This is an affordable car.’ We’re already seeing customers come in who are genuinely surprised.”

Mr Connor added that he hopes to sell about 800 combined units of the S60 and V60 in a calendar year, with an even split between the two.

“These are not meant to be volume drivers in this marketplace,” he said. “They’ll give us a little bit of incremental market share, but I’d rather manage the residual values, manage the long-term desirability of the cars than try and ram them in.”

The T5 engine produces 187kW at 5500rpm and 350Nm from 1500-4800rpm in the Momentum and Inscription but the ante is upped by 5kW/50Nm in the R-Design, with peak power and maximum torque developed at 5700rpm and from 2500-3500rpm respectively.

The 1767kg T5 Momentum and T5 Inscription sprint from standstill to 100km/h in 6.4 seconds, while the T5 R-Design (also at 1767kg) is 0.1s quicker to triple digits. All three have a top speed of 240km/h.

The T8 has even more muscle thanks to its addition of a supercharger that raises the T5 engine’s output to 246kW at 6000rpm and 430Nm from 2200-5400rpm. With an electric motor also in the mix – producing 65kW at 7000rpm and 240Nm from 0-3000rpm – the combined output is a substantial 311kW/680Nm.

The T8 offers up to 50 kilometres of zero-emissions range per charge, while fuel consumption on the combined-cycle test is a frugal 2.0 litres per 100 kilometres and carbon dioxide emissions are just 46 grams per kilometre. Comparatively, T5 variants drink 7.3L/100km and emit 167g/km.

A less potent tune of the 2006kg T8 is available overseas, but VCA instead opted for the punchier Polestar Engineered upgrade that reduces its 0-100km/h sprint time to a brisk 4.3 seconds, while terminal velocity is 250km/h.

Both powertrains are mated to an eight-speed torque-converter automatic transmission and an all-wheel-drive system as standard.

T4 and T6 options are also offered in other right-hand-drive markets, but Mr Connor said neither are planned locally due to the T5’s expected popularity (95-97 per cent of local S60/V60 sales).

“If we found that there was a gap in the market in powertrains, then we would look to introduce them,” he said.

Standard equipment in the Momentum that is expected to account for half of local S60/V60 sales includes the ‘Dynamic Chassis’, black diamond-cut 17-inch alloy wheels, LED headlights and tail-lights, power-folding side mirrors with auto-dimming, rain-sensing wipers, and a hands-free power-operated boot (S60) or tailgate (V60).

Cabin highlights run to a 9.0-inch touchscreen Sensus infotainment system, satellite navigation, Apple CarPlay and Android Auto support, DAB+ digital radio, dual-zone climate control, keyless entry/start, an auto-dimming rearview mirror, power-adjustable driver’s seat with memory functionality, power-folding rear bench (S60), comfort seats, leather-accented upholstery, Iron Ore trim and a blonde headliner.

Advanced driver-assist systems extend to front and rear autonomous emergency braking, lane-keep and steering assist, blind-spot monitoring, cross-traffic alert, adaptive cruise control, a reversing camera, front and rear parking sensors, and hill-start assist.

The Inscription adds black diamond-cut 19-inch alloy wheels, adaptive LED headlights, a head-up display, four-zone climate control, heated front seats with power-adjustable lumber support and cushion extensions, a power-adjustable passenger seat with memory functionality, ambient lighting, Driftwood trim, surround-view cameras and park assist.

The R-Design further includes the ‘Four-C Chassis’, matte-black diamond-cut 19-inch alloy wheels, black side mirror covers, high-gloss black exterior trim, a sports steering wheel with paddle-shifters, sports seats, metal pedals, branded scuff plates, a 230V power outlet, textile and Nappa leather upholstery, Metal Mesh trim and a charcoal headliner.

The ‘Sport Chassis’ is a $750 option for the T5 Momentum and Inscription variants, which can also be had with the Four-C Chassis for $1250.

Other key individual options include 12 metallic or pearlescent paintwork options ($1500).

Several options packages are available, including the $1200 Comfort Pack (T5 Momentum only), $3100 Momentum Lifestyle Pack (T5 Momentum only), $2800 Lifestyle Pack (excluding T5 Momentum), $2400 Momentum Versatility Pack (T5 Momentum only), $1200 Versatility Pack (T5 Inscription only), $3000 Technology Pack (T5 Momentum only), $3500 Inscription Luxury Pack (T5 Inscription only), $3500 R-Design Luxury Pack (R-Design grade only) and $5000 Premium Back (excluding T5 Momentum).

Alongside all other Volvo models, the S60 and V60 are now available with capped-price servicing, costing $1595 for the first three visits (every year or 15,000km, whichever comes first).

This move has come in response to customer, dealer and media feedback, and is enabled by cuts to parts margins.

Both models now ride on Volvo’s Scalable Product Architecture (SPA), joining the S90 and V90 large cars and the XC40, XC60 and XC90 SUVs.

Measuring in at 4761mm long, 1850mm wide and 1431mm tall, with a 2872mm wheelbase, the S60 offers 390L and 392L of cargo capacity in T5 and T8 form respectively.