Volvo is evaluating the feasibility of a new, three-row hybrid SUV that would surpass the XC90 in size and luxury, directly competing with models like the BMW X7 and Mercedes-Benz GLS. This potential expansion reflects growing consumer demand for larger, high-end SUVs, particularly in the crucial markets of the United States and China.
Market Pressures Drive Consideration
Volvo CEO Håkan Samuelsson confirmed the company is “looking into” larger SUV options, acknowledging that while a final decision hasn’t been made, demand in key regions is undeniable. The current XC90, already among the largest hybrid SUVs available, may not fully satisfy buyers seeking more space and prestige.
This shift isn’t just about size. Consumers in China and the US are increasingly prioritizing hybrid technology over full electric vehicles in this segment, likely due to range anxiety and the need for heavier batteries in EVs to deliver comparable utility. Samuelsson indicated that for the “next few years,” a hybrid powertrain would likely appeal more to these buyers.
Production and Platform Strategy
If Volvo moves forward, production would likely take place at its Charleston, South Carolina plant, making the vehicle immediately attractive to US customers. The new SUV could share the SPA2 platform with the XC90 and EX90, streamlining development and manufacturing.
However, Volvo might also leverage synergies within its parent company, Geely, potentially using a platform or components from other group brands like Zeekr. The Zeekr 9X, for example, is considerably larger than the XC90 and could provide a starting point, though it currently lacks the desired three-row configuration.
Implications and Outlook
Volvo’s potential move highlights the competitive pressures in the luxury SUV market. While the company has successfully positioned itself as a premium brand with strong safety and sustainability credentials, responding to changing consumer preferences is crucial for continued growth. The decision to enter this larger segment will depend on balancing market demand, platform efficiency, and the broader Geely group’s strategic goals.
The expansion into larger SUVs is a logical step for Volvo, given the rising demand in key markets and the potential to leverage existing resources within the Geely automotive portfolio. This move could solidify Volvo’s position as a major player in the high-end SUV segment.
