We have to be careful to compare apples to apples. People buy Audi's because .. they want an Audi, not because they want a 4cyl. Those brands that have achieved a certain status level are better able to deal with delivering less and charging more. Volvo is no where close to that status level.
In any event, given that, I am not worried at all about Volvo's 4 cyl only strategy except for maybe the XC90. The only part I don't like is the way Volvo has gone about it. I wouldn't have announced it to the world and the naming scheme is terrible. Even if deep down I was Volvo's owner and for some reason really wanted to be 4 cyl only company, I wouldn't have announced it. What would I gain? IMO, Volvo gains nothing by having announced it except to have closed doors. IMO, depending on how much it would have cost, Volvo should have developed and shown off a 5 or 6 cyl DriveE engine just for the heck of it so that people would have hope, just like Ford has Eco4 and Eco6. Electrification isn't cheap and extra power via electrification is going to be costly. KERS is still 6+ years away. Volvo could have shown off a 6cyl DriveE engine and never released it, but people would have had hope for it, and at least it would be ready if needed.
Sure, the industry has been moving to 4cyls, so Volvo goes and jumps off a cliff and for some reason states to the world, ok, we'll be 4 cyl only. Thankfully at least so far they appear to be very very good 4 cyls, problem is, because of the terrible naming scheme, people don't really find out about them. And people always want more, and I worry that while sales will improve, a 4 cyl only strategy is going to place a cap on how high they will go. Tesla may be doing well, but we'll have to see how long they keep doing well. Every single other brand that has electrified some part of their car has mostly failed, it's just too costly. IMO, people are buying Teslas for now because it's a status symbol and they can claim they are being 'green'. But there are two approaches to that, buying for status and 'green' regardless of cost and not caring how much each mile driven really costs AND buying to save money. Excluding Tesla, IMO, almost every other buyer is doing it to save money and being 'green' is just a side benefit to them. We have no clue how Volvo's electrification strategy is going to play out, but if I was forced to bet today, I'd have no choice but to bet it will fail simply because it's failed for basically everybody else save Tesla and the Prius. Sure, Volvo has announced some tricks like KERS but they are still a long ways off.