• Image Credit: Volvo
  • Image Credit: Volvo
  • Image Credit: Volvo
  • Image Credit: Volvo
  • Image Credit: Volvo
  • Image Credit: Volvo
  • Image Credit: Volvo
  • Image Credit: Volvo
  • Image Credit: Volvo
  • Image Credit: Volvo
  • Image Credit: Volvo
  • Image Credit: Volvo
  • Image Credit: Volvo
  • Image Credit: Volvo
  • Image Credit: Volvo
  • Image Credit: Volvo
  • Image Credit: Volvo
Volvo has introduced its new three-cylinder Drive-E engine for the XC40, its new compact crossover and first vehicle built on its Compact Modular Architecture platform. It's the first three-cylinder engine in the company's 91-year history, and Volvo says it was designed for integration with its Twin Engine plug-in hybrids, meaning a PHEV XC40 is coming. A pure-electric variant is also in the works.

A Volvo spokesman confirms there are no plans to bring the 1.5-liter direct-injection engine, which will be mated to a manual six-speed transmission and offered next year with an automatic eight-speed, to the U.S. At any rate, Volvo developed the engine using the same modular design as its four-cylinder Drive-E engines and says it'll roll off the same production lines as its four-cylinder gas and diesel engines.

"The 3-cyl engine is the most efficient engine to use for a PHEV since it, in combination with the electric motor, provides the performance level that fits this size of car," Volvo spokesman Russell Datz wrote in an email. He adds that the electric motor will be fitted to the front axle in the XC40 plug-in hybrid, meaning the company needed a more compact engine as part of the package. The three-cylinder will also provide improved fuel economy, he said.

The PHEV version of the XC40 is due at the end of the year, Autocar reports, while the pure-electric version, expected to get 310 miles of driving range, will arrive sometime after Volvo releases its first hatchback EV based on the 40.2 concept.

Meanwhile, the three-cylinder engine joins Volvo's 150-horsepower D3 five-cylinder diesel and 190-hp T4 gasoline engines as options in the XC40.

One thing we know for sure is coming for U.S. customers is Inscription trim, the highest level offered. It offers a choice of unique 18-, 19- or 20-inch rims, new chrome on the side windows and mesh grille and model-specific body colors. Inside, there's a new crystal gear knob and driftwood inlays.

Pricing and availability for the XC40 Inscription are to be announced later. Volvo is making the XC40 its first vehicle offered under its Care by Volvo subscription service, which includes insurance, service and maintenance for 24 months. It costs $600 a month for the T4 Momentum package and $700 for the T5 R-Design.

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