Anything is doable, but a smaller and more eco car needs to be profitable and easy servicing. Let LYNK do 20 size is a better idea. But they need a factory to build enough cars in Europe.The 20 series is currently under review.
With the development of the new BMA architecture (smaller than CMA but evolved from it) for Geely by CEVT (Geely-Volvo centre based in Sweden), a 20 series is very doable.
With the synergy with Geely the economies of scale for the BMA platform are there so this is a low risk venture for Volvo. A useful introductory point to the brand. Risks are making the interior parts of a high enough quality and standard to be a Volvo but still have a good profit on each 20 series sold.
Other options are to let Lynk move into the 20 series space leaving Volvo to larger cars.