SAN FRANCISCO – Volvo Car Corp.’s new XC60 cross/utility vehicle does a lot of things well and certainly improves on the Swedish auto maker’s design DNA. But is it enough to carve out space in an ultra-competitive and increasingly crowded segment?

When the XC60 hits dealerships in March, it will go head-to-head with some formidable competition, including the new Mercedes-Benz GLK and Audi Q5 small CUVs. But if Volvo execs are frightened by their rivals, they sure aren’t showing it.

“We’re excited to start seeing comparison tests (with the competition),” says Mike Cottone, XC60 product manager, during a launch event here.

From behind the wheel, we can understand Volvo’s enthusiasm toward the XC60. Resembling a scaled-down version of the 7-seat XC90 CUV, the 5-seat XC60 is sure-footed on the unrelenting switchbacks of San Francisco’s Presidio district.

The XC60’s exceptional handling comes courtesy of Swedish parts maker Haldex AB’s fourth-generation all-wheel-drive system, which Volvo says offers “better and quicker” responses than earlier iterations.

The new standard AWD system boasts Instant Traction technology, which uses an electronically controlled clutch to shift power from the front to the rear wheels depending on where extra traction is needed.

In normal driving conditions, 90% of the power goes to the front wheels. When slip is detected, up to 50% of the torque shifts to the rear axle.

While the XC60 was designed for on-road driving, it is no slouch off-road, Volvo officials say, noting the CUV offers best-in-class 9.1 ins. (23 cm) of ground clearance. Unfortunately, we didn’t get to put the XC60 to the test, as the California Highway Patrol frowns upon unauthorized off-road excursions in the name of automotive journalism.

The XC60 benefits from Volvo’s Dynamic Stability and Traction Control system, which keeps the vehicle on its intended path. Although it sounds as if DSTC may take some control away from the driver, the sophisticated system proves largely unobtrusive during our test drive.

If a potential rollover is detected, the XC60’s standard roll-stability control kicks in, reducing torque and braking one or more wheels to steady the vehicle.

The XC60 shares a platform with Volvo’s well-regarded S80 flagship sedan. To compensate for the XC60’s higher center of gravity, Volvo engineers stiffened the chassis, minimizing body roll during tight cornering.

While the twisty roads in and around San Francisco provide appropriate terrain to demonstrate the XC60’s handling, they don’t permit adequate evaluation of the CUV’s 3.0L turbocharged inline 6-cyl. engine. (And rush-hour traffic limits our speed during long stretches of highway.)

The best indicator of the T6 engine’s abilities comes on steep inclines, where the powerplant propels the 4,174-lb. (1,893-kg) vehicle without struggle.

The engine produces 281 hp and 295 lb.-ft. (400 Nm) of torque, which Volvo describes as “class-leading.” It doesn’t feel underpowered but makes considerable racket during hard acceleration.

The T6 is based on the normally aspirated 3.2L I-6 that was introduced in the ’08 S80. Turbo lag is kept to a minimum through application of twin-scroll technology, which allows the turbocharger to take in exhaust gases in two phases.

Volvo says the system produces the same results as a twin-turbocharger setup. While that may be overstating it, the performance marks an improvement over other single-turbo engines.

The T6 is mated to a 6-speed “Geartronic” transmission that allows drivers to manually select gears. The gearbox has been specifically tailored to handle the engine’s power output, and the sixth gear is used exclusively as an overdrive for economical cruising.

The transmission is a good match for the XC60’s I-6, as it provides smooth, effortless launches and rarely hunts for gears.

The CUV wasn’t specifically designed for towing but is capable of hauling 3,300 lbs. (1,497 kg). It comes with a new Trailer Stability Assist function that prevents trailer swaying by braking one or more wheel, while reducing engine torque.

’10 Volvo XC60
Vehicle type Front-engine, all-wheel-drive, 5-passenger cross/utility vehicle
Engine 3.0L turbocharged DOHC I-6
Power (SAE net) 281 hp @ 5,600 rpm
Torque 295 lb.-ft (400 Nm) @ 1,500-4,800 rpm
Compression ratio 9.3:1
Transmission Geartronic 6-speed auto w/driver shift control
Wheelbase 109.2 ins. (277 cm)
Overall length 182 ins. (462 cm)
Overall width 74.4 ins. (189 cm)
Overall height 67.4 ins. (171 cm)
Curb weight 4,174 lbs. (1,893 kg)
Base price TBA
Fuel economy 16/22 mpg (15/11 L/100 km)
Competition Mercedes-Benz GLK, Audi Q5
Pros Cons
Inspiring sheet metal Mushy Volvo brand image
Impressive safety features …But not easy to turn on
Powerful engine Plug ears when accelerating

The system is similar to one offered by Volvo parent Ford Motor Co.

Although competitive in the performance department, it is the XC60’s advanced safety features that set it apart.

Most notable is the standard City Safety technology that automatically stops the vehicle if a collision is imminent and the driver has taken no evasive maneuvers.

Designed to mitigate low-speed collisions in city traffic, the system works at speeds up to 19 mph (31 km/h). If the vehicle in front brakes suddenly, City Safety determines a collision is likely and the brakes are pre-charged. If the driver fails to respond, the CUV applies 50% of braking power automatically.

Volvo says the system, which uses a laser sensor embedded in the windshield, is not designed to detect pedestrians, bicyclists or animals.

During a demonstration of the technology here, the system abruptly stops the XC60 just inches before hitting an inflatable target the size of a vehicle. Volvo says the system is supposed to brake hard, rather than coast to a stop, so drivers won’t become dependent on the technology.

The XC60 also gets Volvo’s Blind Spot Information System; a collapsible steering column; dual-threshold airbags; dual outboard 2-stage child booster seats with adaptive seatbelts; side-curtain airbags; whiplash-protection seating; and lane-departure warning.

Styling is important to Volvo buyers as well, and the XC60 bears some of Volvo’s finest sheet metal ever.

Yes, it resembles its XC90 sibling, but the XC60 exhibits bolder lines and the standard 18-in. wheels (19-in. rubber is optional) are pushed out to the corners, giving the junior CUV an aggressive stance.

Particularly attractive (and impressive at night) are the light-emitting diode taillamps, which illuminate the shape of the CUV’s strong shoulder line.

Inside, the XC60 borrows heavily from its Scandinavian heritage with clean, flowing lines and a “floating” ultra-slim center stack – now a Volvo design hallmark. While the CUV comes standard with an aluminum center stack, our test vehicle has the optional wood trim, which looks spectacular, with a very natural, no-gloss finish.

Controls are well configured, but not especially intuitive, particularly where the vehicle’s safety systems are concerned. Also, the pre-production model’s navigation system went on the fritz about halfway through our drive.

Volvo debuts two new exterior colors on the XC60: Lime Grass Green Pearl and Terra Bronze Pearl. The former can be paired with an off-black interior with Lemon Green accents – an over-the-top color scheme that seems too brash for a Volvo.

The more appropriate and understated trim color inside is the traditional Sandstone/Beige with Espresso leather. Either way, the cabin of the XC60 demonstrates excellent build quality.

Final pricing is expected in the coming weeks, but Volvo says the starting price will be less than $40,000.

The XC60 is one of the finer vehicles to come out of Volvo in years and serves as positive proof the auto maker is stepping up its game. Perhaps the greatest obstacle facing the XC60 is Volvo’s brand identity, which is neither full-blown luxury nor run-of-the-mill transportation.

Volvo needs more vehicles like the XC60 to demonstrate the marque’s boxy, utilitarian cars of the past are exactly that – in the past.

bpope@wardsauto.com