For quite some time, Volvo has relied on an aftermarket company called Polestar to coordinate racing efforts, sell performance parts, and build high-performance versions of its cars.

The partnership was apparently beneficial to Volvo, as it just announced that it will buy Polestar outright.

In the future, the Polestar name will be used for performance versions of mainstream Volvo models, making it analogous to the BMW M or Mercedes-Benz AMG badges.

DON'T MISS: 2016 Volvo XC90 T8 Plug-In Hybrid 'Twin Engine': First Drive

That new mission will include building high-powered plug-in hybrids, the Swedish carmaker said in its announcement.

Volvo currently offers Polestar versions of the S60 sedan and V60 wagon in very limited numbers--it expects to sell just 750 worldwide this year.

With its acquisition, though, Volvo plans to increase production of sporty models to 1,000 or 1,500 per year "in the medium term."

2016 Volvo XC90 T8 Twin Engine plug-in hybrid

2016 Volvo XC90 T8 Twin Engine plug-in hybrid

That leaves room for a greater breadth of models--including higher-performance plug-in hybrids.

Volvo already claims to sell more plug-in hybrids in Europe than any other carmaker, and says their powertrain technology will be adapted to future Polestar models.

Polestar will "further utilize Volvo's twin-engine electrification technology to develop next-generation performance cars," a Volvo statement said.

ALSO SEE: Volvo's Triple-Turbo Four-Cylinder Engine: 450 HP From 2.0 Liters (Oct 2014)

"Twin Engine" is the nomenclature Volvo uses for its plug-in hybrid powertrains.

U.S. buyers will get their first chance to experience one of those in the 2016 XC90 T8 SUV.

Its powertrain consists of a supercharged and turbocharged 2.0-liter four-cylinder gasoline engine working with two electric motors, one between the engine and an eight-speed automatic transmission, the other on the rear axle for on-demand all-wheel drive.

2012 Volvo V60 PHEV

2012 Volvo V60 PHEV

The XC90 T8 is already on sale in Europe, and will reach U.S. showrooms this fall.

When it does, the Volvo will be part of a fast-growing crop of luxury plug-in hybrid SUVs, including new models from Audi, BMW, and Mercedes-Benz, plus the existing Porsche Cayenne S E-Hybrid.

MORE: 2012 Volvo V60 Plug-in Hybrid First Drive Report (May 2011)

Even before introducing the all-new XC90, Volvo saw success in Europe with a plug-in version of the V60 wagon.

Originally called the V60 PHEV and now known as the V60 Twin Engine, it uses a 2.4-liter diesel engine to drive the front wheels, and an electric motor to drive the rear wheels.

Volvo previously discussed bringing the plug-in hybrid V60 to the U.S., but concluded that a larger SUV was more suited to U.S. market demands.


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