Speaking to Autocar at the Detroit motor show, Green said the XC40 will be the first model to use Volvo’s CMA architecture and the base development work of the car has been completed.
“There’s a big chance it’ll be one of the most successful cars in our line-up,” he said.
The family of 40-series models, which is also set to be sold in the US, will represent “a significant part of growth in the next three to four years”, said Green.
The XC40, which will rival the BMW X1 and Audi Q3 in the competitive and rapidly growing compact SUV segment, was previewed last year by the Concept 40.1, along with another potential 40-series model, the Concept 40.2 saloon.
A V40 replacement will also be spun off the CMA platform, which Volvo has co-developed with Geely, its Chinese parent firm. Geely plans to use it to underpin a range of models from its new Lynk&Co brand.
This year will also mark the launch of the second-generation XC60 SUV, which will replace Volvo’s bestselling model. Replacements for the S60 saloon and V60 estate will follow soon after, making the XC90 SUV the oldest model in Volvo’s range within a couple of years.
Green said: “The XC60 is our biggest-volume car that sells broadly in Europe, China and America. It brings significant profits so is crucial in many aspects. [The new model is] a fantastic car, a big step forward.”
Volvo will then turn its attention to the launch of its first all-electric model in 2019.
“We believe strongly in electrification,” Green said. “We are working very hard on our first full EV. In 2019 it will be on the road. This is not a one-off. It will be followed up by more products. I see EVs as a significant part of our portfolio, a wide range.”
Despite the predicted rise in EVs and growing pressure on diesel, Green said Volvo is continuing to develop diesel engines.
“How long [diesel has left] is very difficult to say,” he said. “I believe electrification will start to come and there will still be a place for diesel next to it. Then you argue on the switch. Right now, we’re developing diesels. For how long is one of the questions to focus on.”