Australia has often been criticised for being a laggard compared with other parts of the world when it comes to electric vehicle (EV) ownership, something critics attribute in part to a lack of coordinated and effective state and federal government policies to encourage EV uptake.

Despite significant gains in this area, including in Queensland which has the country’s most generous EV subsidies, proponents of faster EV and low-emission vehicle (LEV) adoption point to the fact Australia still does not have a fuel efficiency standard as evidence of a lack of real policy commitment in this area.

While that may be the case, Volvo Australia is one entity that has taken it upon itself to try and lead the change to greater EV adoption Down Under, announcing its range will be all-electric by 2026.

That’s four years earlier than its Chinese-owned Swedish parent company, which has committed to an EV-only lineup by 2030, with an interim target of 80% of all new Volvos being EVs by 2026.

For now, however, internal combustion engine (ICE) powered vehicles remain an important part of the Volvo mix both here and aboard, including with the XC40 compact SUV range, which stands out as one of Volvo’s big success stories in recent years.

The XC40 lineup, which includes two fully electric models alongside three ICE models, accounted for more than half of Volvo Australia’s year-to-date sales at August 2023.

It’s also the number one selling small luxury SUV, beating out rivals including the Audi Q3, BMW X1 and Lexus UX.

Volvo recently upgraded the electric versions of the XC40 and the closely related coupe-style C40 for MY24, introducing new powertrains and larger batteries for greater range and faster charging.

The new models are available to order now but not due to arrive until the end of 2023.

Improved efficiency

The trio of ICE-powered XC40’s also benefited from efficiency gains thanks to the introduction of mild hybrid electric vehicle (MHEV) technology.

This change sees the end of the previous generation 2.0-litre petrol-powered models including the Inscription, Momentum and R-Design grades, while the lone plug-in hybrid electric vehicle (PHEV) model has also been dropped.

This means the recently revised range now has three petrol MHEV variants sitting alongside two pure EV models.

The mildly refreshed range includes some subtle styling tweaks including new wheel designs, equipment upgrades and a Google Android operating system for the infotainment centre.

The front-wheel drive Plus B4 MHEV is now the entry point to the XC40 range, priced at $53,490 (MRLP).

Next up comes two all-wheel drive MHEV variants, the Ultimate B4 Bright costing $60,490 (MRLP), and the Ultimate B5 Dark priced at $64,990 (MRLP).

Sitting atop these vehicles are the two XC40 EVs, the front-wheel drive XC40 Recharge Electric costing $73,990 (MRLP), and the dual motor Recharge Electric AWD which lists at $81,490 (MRLP).

Equipment highlights on the flagship Ultimate B5 Dark MHEV we’re testing here include 20-inch alloy wheels, dual-zone climate control with pollen filter and auto air quality monitor, keyless entry, push-button start, imitation leather and suede seat trims, power adjustable front seats with four-way lumbar adjustment and two memory positions for the driver, manual front cushion extensions, and power-fold rear head restraints.

Also included in the generous list of standard kit are roof rails, LED headlights, security alarm, rain-sensing wipers, dusk-sensing headlights, foglamps with cornering function, auto dim rear vision mirrors, tyre pressure monitoring, hands-free power tailgate, remote engine start, and a configurable 12-inch driver display.

Seven airbags, including a driver’s knee airbag are fitted, with driver support technologies include a road-sign information system, hill start assist, hill descent control, speed limiter, and adaptive cruise control with traffic jam assist.

Also included in the B5 Dark’s standard safety kit is front-collision mitigation support, rear-collision mitigation warning and support, lane keeping aid, blind-pot information, cross-traffic alert, front and rear park sensors and a 360-degree camera system.

The standard audio unit is an eight-speaker system with DAB+ radio, but our test car came fitted with a 13-speaker Harmon Kardon premium sound system, which can be had as a $1,300 standalone option, or bundled as it was in this case with a sunroof as part of Volvo’s $2,600 Lifestyle Pack.

Other factory options for the XC40 MHEVs include a Climate Package which brings heated front and rear seats, and a heated steering wheel for $900. These items are standard equipment on the EVs, as is the Harmon Kardon audio system on the dual motor variant.

Black Stone, a solid exterior paint colour, is standard on petrol/hybrid variants, with the remaining eight metallic or pearl finishes attracting a $1,200 charge.

The XC40’s 9-inch portrait-oriented infotainment system now incorporates a Google Automotive digital package that includes Google Maps, Google Play, and Google Assistant with voice control. The Volvo Cars app allows remote access as part of the package. A four-year subscription comes with the vehicle, after which fees apply.

It’s not the most intuitive system but users will no doubt become familiar with negotiating the required functions over time. Something we aren’t big fans of, though, is the fact the climate control settings are embedded within the screen menus, a trend started by Tesla and which is becoming increasingly common.

Presumably, it saves the car company a few dollars by eliminating components from the manufacturing process, but for our money you just can’t beat the simplicity of dedicated HVAC switches.

Included among the XC40’s connectivity features are smartphone mirroring via Apple CarPlay and Android Auto, Bluetooth, a wireless phone charging pad, two powered USB Type C connections in the front, and two USB ports in the rear.

Under the bonnet

All three ICE models are powered by a four-cylinder turbocharged 2.0-litre petrol engine with 48-volt MHEV technology.

The latter enhances fuel efficiency through energy recovery and storage and provides some extra oomph during hard acceleration.

If you’re wondering about the meaning of the B4 and B5 naming conventions for these ICE models, it’s simply that the B4 model develops peak outputs of 145kW/300Nm, whereas the B5 boasts a gutsier 183kW/350Nm.

The B5’s extra power and torque shaves a claimed 2.0 seconds off the B4’s 8.4 second 0-100km/h sprint.

By comparison, the soon-to-be-replaced MY23 XC40 EVs boast peak outputs of 170kW/330Nm for the single motor front-wheel drive model, and 300kW/660Nm for the dual motor AWD version.

Against the stopwatch, the single motor EV covers the 0-100km/h dash in 7.4 seconds, while the twin motor stops the clock at a Tesla Model Y rivalling 4.9 seconds.

Behind their petrol-hybrid powerplant, XC40 B4 and B5 models run a smooth-shifting eight-speed torque-convertor auto with manual shifting possible via the lever (there’s no paddles).

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In the B5 format we drove, the powertrain delivers punchy and responsive performance, with its 350Nm of torque usefully spread between 1,800 and 4,800rpm ensuring good drivability.

There’s little to complain about performance-wise, but ultimately it can’t compete with the sheer low-down grunt and energetic performance afforded by the significantly more expensive dual motor EV variant.

One point worth noting for Qld drivers who prefer to keep their car’s interior pleasantly chilled during the steamy summer months is that you can’t deactivate the fuel-saving stop-start system of the XC40 petrol-hybrid models.

Also worth noting is that at 11.0L/100km our test average fuel consumption in the B5 was also considerably higher than the official combined cycle figure of 7.2litres/100km.

The test route encompassed a mix of urban driving and some faster-paced back roads, so more frugal numbers may be achievable under different conditions.

XC40 confident on the road

Dynamically, the B5 Ultimate Dark is easy to drive, with a pleasingly capable and secure stance through twists and turns. It feels very confident even when pushing the pace, a little, and we found the steering more palatable in its ‘firm’ setting versus the lightly weighted alternative.

Once again, it requires a dive into the fiddly touchscreen menu settings to make this adjustment, so most drivers will likely adopt a ‘set and forget’ approach.

The ride quality generally copes comfortably with road imperfections and stays decently composed, despite rolling on 20-inch wheels with low-profile 45-series rubber.

The interior features an attractive minimalist design with a quality look and feel, with an enticing touch of ‘bling’ provided by the lovely Orrefors crystal gear knob.

There’s generous space and comfortable seating for occupants by compact SUV standards, plus a practically proportioned 452-litre cargo bay.

Of note here is the luggage bay’s thoughtful floor design that allows it to concertina forward into a vertical position to become a handy load-restraint system.

Flat-folding split-fold rear seats and a ski port expand loading options and capabilities.

Volvo’s new car warranty covers the XC40 for 5 years/unlimited kilometres, which isn’t among the longest warranties available these days but on par with most other prestige brands.

The brand also offers pre-paid service plans for three years/45,000km ($1,750) or five years/75,000km ($3,000) with scheduled services required at 12-month/15,000km intervals.

The age of the electric car is upon us and Volvo is moving quickly to ensure it has its bases covered.

But not every new car buyer is ready now to make the EV leap, and for those buyers the XC40 B5 Ultimate Dark offers plenty that is attractive, even if by Volvo’s own admissions, its days are numbered.

Key info

• MLP: $64,990
• ENGINE: 2.0-litre 4-cylinder turbocharged petrol/48volt mild hybrid.
• ANCAP CRASH RATING: 5 stars (2018)
• FUEL CONSUMPTION combined cycle: 7.2 litres/100km (165g/km CO₂)
• FOR: Spacious interior, quality finish, punchy performance, confident road holding, comfortable ride, decent value by prestige vehicle standards.
• AGAINST: Infotainment could be more intuitive, space saver spare, high fuel consumption, stop/start system not switchable.