Volvo is planning to add to its expanding XC family with a baby 4×4-crossover, the XC30, forming part of a major overhaul of the Swedish brand’s range by 2010.

The 4×4 counterpart for the C30 will be joined by an estate car derivative, to be badged V30, as Volvo aims to harness the growing premium lower medium market dominated by BMW‘s 1-series and Audi‘s A3.

Described by one insider as “naturally filling white space”, the changes also involve rationalising the S40 and S60 into one new model, probably using the S60 badge, which will compete more directly with BMW’s 3-series. The current S40 and S60 are out of kilter with their rivals in size terms, making them difficult to pigeonhole.

The S60 is unlikely to have a V60 estate variant as Volvo is wary of building a car too close to its V70. To accommodate the new S60 the current S40 will be phased out by the end of 2010, by which time the V30 and XC30 will be in showrooms.

Meanwhile, Volvo will reveal the new XC60 small off-roader (pictured) at the Geneva motor show in March, with a market introduction in September 2008. It will be largely faithful to the concept version, featuring sports coupe/4×4 crossover styling.

Senior Volvo management is aware of criticism that the brand, leaders in large estate cars, is out of kilter with its saloons.

Analyst Jay Nagley, managing director of Spyder Automotive, said: “Volvo needs to tidy up the mess it has made of its saloon car strategy. The S40 and V50 are based on the Focus platform yet have illusions about competing with the BMW 3-series. The S60 is a worthy misfit, between the 3- and 5-series, while the S80 is designed for the US market.”

An unnamed dealer source added: “People come in and ask if there are four- or five-door versions of the C30, and when you say they are the S40 and V50 they are a puzzled.”