Ok, right to it: Cup holder sticks, CD can't be used when using cup holder, radio/cd lights are out, arm rest is cheap and a nusance (pops down with the slightest touch and hits drink in cup holder), head lights go out all of the time, dash board reflects on windsheild making it hard to see when the sun is out, paint job was poor, rear locks stick. Maybe the design has changed in 8 years.
We've put 150k miles on the car since it was new and have had a good experience overall. Good gas mileage, comfortable, and swallows a lot of luggage for a car this size. Problems have been the usual complaints for these cars - arm rest broke at 100k, cup holder jammed, and many headlight bulbs. I've gotten really good at replacing them. No major problems. Currently have an intermittent starting problem that our local dealer doen't seem to be able to fix. I usually won't buy a car the first year it's made but this one fit our requirements so closely I decided to go ahead. A few early problems but a couple of software updates and it settled down. Good service, good car.
Carries a ton of stuff in trunk with the seats down it will carry an even larger load. Looks good, attractive stying. Reasonable acceleration and handling for this class of car.
The newer S40's seem to have fixes for most of the most troubling issues. The dash needed a new layout. The headlights burning out also needed to be addressed.
I bought a Volve for safety and reliability. Safety I got, reliability was poor. Changed out both front strut assy's at 60K miles, turbocharger leaked costing over $800 to repair before 80K miles. It is parked in my garage now because there is a front suspension problem. I am going to get rid of it and never buy a Volvo again. The check engine light comes on more often than not without a defineable cause. Shift handle now fails to lock in park position.
Steering and handling.
Gas mileage is poor for a small sedan. Turbo charger should not have failed at under 80K miles and struts typically last longer than 60K miles on such a small car.
I had dreamed of owning a Volvo for years and when I finally got my Volvo the nightmare began. In only owning my car for one in a half years I have easily put over $3000 in repairs. The check engine light turned on every other week it seemed like. Even Volvo repaired it and only 500 miles later it was on again. Volvo uses the cheapest plastic and it breaks just by touching it. The only thing I really liked was how it handled and the trunk and glove box space. Besides that Volvo should think about starting from scratch because this car is a waste.
Drive train, good gas mileage, plenty of glove box and trunk space.