The 2007 XC70 was introduced late in 2006 and is based on the S80/Ford Mondeo platform.

The new model has enhanced ground clearace, is larger all round and features updated DSTC and Hill Descent Control borrowed from Ford's ownershp of Land Rover at the time. The new model has much greater off road prowess than the model it replaces, perhaps also due to the use of Haldex Traction's Third Generation AWD controller.