VOLVO becomes first car manufacturer to offer plug-in hybrid versions of its entire model range with the launch of new XC40 T5 Twin Engine, priced from £40,905.

The front-wheel-drive hybrid system in the newcomer uses a 180hp three-cylinder 1.5-litre petrol engine with 82hp electric motor to achieve combined output of 262hp - making it the most powerful car in the XC40 line-up.

Preliminary WLTP test data indicates CO2emissions from just 38g/km and combined fuel economy of up to 141.1mpg, combined with 0-62mph in only 7.3 seconds.

The XC40's lithium-ion battery with 10.7kWh capacity provides all-electric driving range of up to 28.6 miles and a new seven-speed twin-clutch automatic transmission is fitted as standard.

The emissions efficiency of the T5 Twin Engine delivers significant cost-of-ownership benefits, including a benefit-in-kind tax rate for business/company car drivers of just 16 per cent.

For a 40 per cent taxpayer, this means a monthly tax bill starting from £218 in the current financial year, a base figure that will fall to just £163 in the 2020/2021 tax year - adding up to a saving of £660 per year.

XC40 T5 Twin Engine models come with a recharging outlet on the nearside front wing. A 4.5m cable with a three-pin plug is provided as standard, while a type 2/mode 3 fast-charge cable is available as an optional extra for £50.

Charging via the fast-charge cable will completely recharge the car's high-voltage battery in as little as 2.5 hours. Fully charging via the three-pin plug cable takes between 3.5 and 6 hours.

First deliveries for UK customers are expected from February and the powertrain offered in R-Design, R-Design Pro, Inscription and Inscription Pro trim levels.