Speaking to Britain's Autocar magazine, Volvo R&D Head, Henrik Green, said the introduction of the XC20 would not come as a problem given that the automaker's Compact Modular Architecture (CMA) can be reduced in length to accommodate it.
Currently serving as a base for the XC40 and next generation V40, as well as sister Chinese brand Lynk & Co, Green also stated that the brand's "almost ready" 1.5-litre three-cylinder Drive-E petrol engine would be the perfect fit for the XC20, as it is expected to debut in the XC40.
"It can go in any vehicle in the range, so it’s a marketing decision on which models to fit it to,” he said, adding that plans to introduce more electric drivetrains are also progressing.
"We’re looking at broad solutions that are affordable. Volvo’s aim is to put these technologies within reach of more buyers than is presently the case with the plug-in hybrid models Volvo offers today".
No indication of when the XC20 would reach production has yet been made.
Note: 40.1 concept pictured