Volvo is looking at being able to comply with the stricter emissions regulations in Europe, U.S. and China, and so it will halt its production of its lineup’s biggest engines within the next decade. Before the decade ends, all Volvo models will have engines with no more than four cylinders. Beginning in 2013, this new range of 3 and 4 cylinder petrol and diesel engines will replace Volvo’s 5 and 6 cylinder petrol engines as well as its 5 cylinder diesel. It’s likely that the VEA (Volvo Environmental Architecture) engine will first be used in one of Volvo’s current models. The VEA family will offer four engines, including the 1.5-liter 3 cylinder petrol direct-injection and diesel engines and the 2.0-liter 4 cylinder GDI and diesel engines. These will all be based on a 500cc cylinder displacement.
The Volvo’s 4 cylinder engines will offer better performance than the existing six-cylinder units. They will also offer lower fuel consumption than the current 4 cylinder lineup. Volvo said that the new engines will weigh 90kg lighter than the existing units. The fuel economy of the new powerplants will also be improved by as much as 35%. The new VEA engines are seen as a significant strategy in Volvo’s goal that by 2020, its annual sales will more than double to 800,000 cars. Volvo will invest $11 billion to be spent in the next five-year period to tap demand in markets such as China.
I believe the biggest reason they have moved to stop making engines larger than 2.0L is pressure from the Chinese government.