Review: 2023 Volvo XC40 Nails Fashion and Function

Almost 25 years ago, in the comedy classic Meet the Parents, Greg Focker arrives at ex-CIA spook Jack Byrnes’ front door in a green Ford Taurus. The nice color, Focker admits, was the rental counter attendant’s choice. “They say geniuses pick green,” he tells Focker, laying a trap for his daughter’s nervous boyfriend. “But you didn’t pick it.”

If that same scenario were to play out today, with a 2023 Volvo XC40 in metallic Sage Green, even a dunce like Focker would have taken credit for the selection. The XC40 is a rare thing in a sea of forgettable compact crossovers—a stylish, attractive city car with a range of unconventional color choices and useful features. And unlike Ben Stiller’s hapless Focker, who flubs and fumbles at every opportunity, the XC40 comes across as thoughtful, wise, and savvy in its intended urban environment. 

The XC40 is Volvo’s smallest crossover, launched for the 2018 model year. It’s the first car to use the automaker’s Compact Modular Architecture, which also underpins the all-electric Polestar 2 (along with a number of Geely and Lynk & Co vehicles sold primarily in China). Since the original XC40’s launch, Volvo has added a coupe-like C40 variant as well as plug-in hybrid and pure-electric powertrains, but for 2023 the changes to the gas-powered XC40 were minor. Aside from a new mild-hybrid system that’s standard, a built-in Google/Android infotainment system, and revised front-end styling, it’s more or less carryover.

Not that we’re complaining—the XC40 is arguably the best luxury compact crossover out there, competing with the BMW X1, Mercedes-Benz GLB, and Audi Q3. Being a luxury product, the XC40 is fairly expensive for a car this size at $50,190, but it really does look twice as good as a Honda HR-V that costs $25,000. The short overhangs, chunky D-pillar, and clean body lines give the XC40 a sophisticated air without being overwrought. The pale metallic green paint looks daring and upscale, distinct from the grays, silvers, and blacks in every suburban cul-de-sac. It’s exactly the type of vehicle wealthy parents buy their fortunate teenagers as a first car, or that a young professional with a well-paying gig stretches to afford when a Toyota Corolla Cross starts to feel low-rent.

Specs: 2023 Volvo XC40 B5 AWD Ultimate

• Price: $47,595/$50,190 (Base/as tested)
• Powertrain: 2.0-liter turbocharged four-cylinder; hybrid integrated starter-generator; 8-speed automatic transmission
• Horsepower/Torque: 247 hp, 258 lb-ft
• Layout: All-wheel-drive, four-door, five-passenger SUV
• Curb Weight: 3861 lb
• EPA-rated fuel economy: 23 mpg city, 30 mpg highway, 26 mpg combined
• 0–60 mph: 6.1 seconds
• Competitors: BMW X1, Mercedes-Benz GLB, Audi Q3, Alfa Romeo Tonale

Despite Volvo selling about a third of BMW’s volume in the U.S., the XC40 has outsold the X1 in each of the last four years. (2021 was Volvo’s best year in the segment, with 26,802 XC40s sold.) One reason for that is the variety in the model’s lineup, which has included the pure-electric Recharge since 2020. Another reason, we’d wager, is the overwhelming appeal of the XC40’s interior. 

Compared with the fairly rote and dull X1 or Q3, the inside of the XC40 is bright, airy, and optimistic. Our top-trim Ultimate test car features the tasteful “Driftwood” trim, along with a Harman Kardon sound system, crystal gear selector, leather seating surfaces, the blonde-colored headliner, and a panoramic moonroof. At least at this trim level, this is a small luxury car that does not feel cost-cut. The door handles are metal and feel hefty. Buttons actuate with a pleasant click. The only obvious evidence of penny-pinching is the speaker grille treatment for the rear doors, which uses plastic rather than the handsome metal employed up front.  

The main weak point of the environment is that the primary touchscreen is designed for the outgoing Sensus system’s vertical orientation, while Google/Android’s tile-like software arrangement (and Apple CarPlay’s) is optimized for horizontal display. The result is somewhat awkward to use, particularly when the car is backing up and the top half of the screen turns more or less into a black box because the rear-view camera feed has to render in a discernible aspect ratio. In general, the icons appear somewhat small, and the system can be frustrating to navigate while the car is moving. 

The driver sits high up, which is what most buyers in this segment want—a sense of command from behind the steering wheel. Shoulder room is excellent for a subcompact car, and there are a number of helpful storage compartments. The door pockets are positively huge (lined in fabric rather than scratchy plastic) and inside the center console is a handy removable wastebasket for gum wrappers and McNuggets boxes. If you’re getting takeout, rather than place the bag haphazardly in the footwell or second-row floor, you can hang it safely on a deployable “curry hook.” Inside the glovebox is a designated pocket for the manual, keeping it tucked away for when you need it. Back seats are more than reasonable for the subcompact class, and the mesh map pockets behind the front seats are genuinely useful. In the trunk, too, is a foldable divider that better contains groceries and prevents them from flying around. Lift up the trunk floor and there to greet you is another rarity in the world of modern luxury cars: a spare tire with a jack.

Comfortable as the XC40 is for short trips, the seats are a bit firm and don’t have the support for multi-hour trips without needing to stop and stretch. Indeed, the XC40 doesn’t feel nearly as planted and sure-footed as the larger SPA-platform cars like the XC60 and XC90, which barrel down the interstate like bullet trains. The XC40 is much more at home darting through city traffic, where its short wheelbase and compact dimensions shine. Despite the Ultimate trim’s 20-inch wheels, the ride is controlled and smooth even over big impacts. There’s a small amount of body roll and head toss when making sharp turns, but it’s nothing egregious. Spanking the XC40 over your favorite road will reveal no hidden fun, but for the concrete jungle, this is an expertly tuned suspension.

The powertrain, too, is suited to the city: low-rpm torque in quick bursts. The XC40’s sole gas powertrain is a 2.0-liter, direct-injected turbocharged four-cylinder packing 247 hp and 258 lb-ft of torque. It’s a punchy little powerplant with a workaday personality, happier below about 3400 rpm than anywhere else in the rev range. It’s mated to an eight-speed automatic transmission that could be a bit quicker to downshift but is otherwise unobtrusive.

What’s disappointing here is the mild-hybrid setup. Volvo makes a big deal out of this in its marketing materials, particularly on its website. The automaker touts how the 48V battery and 13-hp integrated starter-generator aid in acceleration and braking to improve performance and reduce fuel consumption. In practice it adds just 1 mpg city (and 1 mpg combined) on the EPA rating system, for a total of 23/30/26 mpg city/highway/combined. Perhaps it’s a good thing that the system is unnoticeable when accelerating, but it causes the brake pedal to, at times, feel oddly firm and difficult to modulate. Meanwhile, the non-hybrid BMW X1 xDrive28i makes similar power and 295 lb-ft of torque from its 2.0-liter engine yet manages 25/34/28 mpg highway with one fewer transmission gear. Fuel economy isn’t necessarily a dealbreaker in luxury segments, but we’d expect better from any hybrid, mild or otherwise.

At just over $50,000, the XC40 is a few thousand dollars more expensive than a comparable X1 or GLB. Stooping to the next-down XC40 Plus model saves about $3500 and forgoes the 20-inch wheels, adaptive cruise control, and Harman Kardon audio system without sacrificing much else, so that’d be our pick. Green or not, it doesn’t take a genius to realize Volvo has a great little car on its hands.

2023 Volvo XC40 B5 AWD Ultimate

Highs: Fantastic styling, practical interior, great ride quality over rough city pavement.

Lows: Lackluster fuel economy for a hybrid, inconsistent braking feel, seats not up to usual Volvo standards for long trips.

Takeaway: The XC40 nails exactly what entry-level luxury customers want from a small crossover, whether it’s fashion or function.

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