The first generation of the Volvo S40 was released in 1995 as the Saloon or sedan and the Versatility/estate or V40 station wagon cars. The V40 was designed by Volvo’s Design Director, Peter Horbury. The car was introduced to markets in the Far East, Australia, and both North and South America. This first generation was upgraded in 2000 with several features in the 40 Series. These included more safety implements, new front suspension and steering design, larger tires, direct fuel injection of diesel, and a wider track width. The exterior was modified with bigger headlights and rear light clusters.

The Volvo S40 has been the recipient of several awards, commended for the sleek look of its five-door station wagon and four-door sedan. The car also wields efficient and strong power via its four-cylinder engines that contain 1.9 turbo diesel. The second generation has also received several awards, such as South African Car of the Year and Canadian Car of the Year. This modified version was introduced in 2004 and was produced in the Volvo factory located in Belgium. Some of its features are likened to the European Ford Focus and the Mazda 3. Some of its upgraded features include a 2.5L five-cylinder engine for the turbo.