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I have another theory, too: the new design. The long-lived, proven brick-like shape of the Volvo was part of it's brand mystique...and an assurance that the changes you were buying in a new model year were engineering improvements, not a style make-over. Right now, you're buying both and that would make any buyer queazy. As the driving world gets more accustomed to seeing the new design (some of it clearly targeted for American taste), I expect numbers will go up.
Besides, there's a recession on. A big car payment is probably not top priority right now. A buyer can ride out the poor economy in a 0% car for a year or two...then get an AWD S60 when the some of the kinks have been worked out of it.
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