'Something has got to give': Volvo warns an Australian car market flooded with new brands is unsustainable, but vows it will survive in the face of XPeng, Deepal, Leapmotor and more

Volvo warns that "something has got to give" in Australia's new-car market, with too many brands now fighting for too few sales for all to survive.

That's the word from Volvo Car Australia Managing Director Stephen Connor, with the senior executive also detailing how his brand will survive the new-marque onslaught.

"We've got 70-plus OEMs here, and we've probably got another 20 arriving on our shores in the next short period of time. It is crazy," he said.

"The market is, they reckon, 1.2 million this year. I personally think it's about one million, but let's go with the experts, and they're saying it's 1.2.

"So 1.2m (sales) with probably 90 OEMs – something has got to give.

"I think the people who will struggle are the people who are going to be fighting in that volume segment. And I think, good on the new entrants coming in. They're going to bring a new dynamic."

Asked whether all 90 brands would still be in Australia in five years time, the executive replied "I don't think so".

"I think there will be some consolidation, and this is only my personal view," he said, "I think some brands who have come in, the new ones, have gone, (saying) this is too hard and too difficult."

His thoughts echo those of Kia, Toyota and other major players, all of whom suggest the new-car makeup in Australia is going to change, though Volvo is in a unique position, given several of the new players – Polestar, Geely, Zeekr and the soon-to-arrive Lynk & Co – are all part of its extended family .

But Volvo says realistic expectations and a business model not contingent on extreme volume will ensure the marque survives in Australia.

"We're looking for marginal growth this year, which is okay. We've gathered production based on marginal growth," Mr Connor says.

"I think it's important for us to grow as a brand. But we don't need to grow by 20 per cent. Five per cent, two per cent – that's good enough for us as we go forward. Our production this year is based off about 9,500 units. And we're comfortable to achieve that."

A changing product line-up will fuel that marginal increase, Mr Connor says, with some well-known models on the way out, replaced by vehicles the brand hopes will capture more sales.

"So S60 and V60, we say goodbye this year to those models. They were only about 300 cars a piece. There's a lot of time and energy spent just to sell 300 cars, and as you know, sedans are struggling in this marketplace," he says.

"We've got the EX90, which will be about 300 cars this year. We've got XC90, the new one. So that will be about 1100 units roughly. We'll get some extra growth from EX30 Cross Country. We have refreshed XC60, a big segment for us. It's normally about 3000 cars. Then later on this year we've got the ES90 as well, which will be small volumes again.

"But you see, we've consolidated the line-up. So that's where our growth will come from. Refreshed XC90, refreshed XC60. We've got obviously XC40, which is still a great seller for us as well, and then you've got EX30."