As long as BMW doesn't own Volvo, then the Swede is allowed to target the roundel's cars as competitors. Autocar reports that Volvo is shaking up the lowest two rungs on its sedan line to put more space between them, and to better compete with the 3 Series.

The smallest sedan, the S40, will be be made over from a 4-door sedan into a 5-door hatchback along the lines of the A3 and BMW 1-series. The very name S40 might also be sacrificed, changed instead to V40. The S60, instead of disappearing entirely, will get a longer wheelbase, a better interior, shared tech from the S80 and Mondeo, and a chassis that does a better job at challenging 3 Series dynamics. Part of that redesign, if the renderings are accurate, will be a flared three-section front bumper that is the new hotness in car design. Regarding the car's sporting aspirations, engineers are said to be battling accountants for funds to design a more sporting chassis. Engines for the S60 will include a 2-liter and 2.2-liter 4-cylinder diesels, the D5 5-cylinder diesels, as well as a 2-liter gas turbo.

It is claimed also that the Volvo logo will also be altered, losing the diagonal bar that spans the grill. Only the circle and arrow -- a stylization of the chemical symbol for iron -- will remain. All of these changes are slated to appear in 2009-10.

[Source: Autocar]