In 1994, TWR returned to the BTCC, allied with Volvo. This partnership was responsible for the controversial 850 Estate racing car, which was only rendered uncompetitive when the FIA allowed the use of aerodynamic aids in 1995. TWR then built and ran the works 850 Saloon with six wins in 1995 and five wins in 1996, and S40 securing one win in 1997 in the BTCC.
In 1998, TWR Volvo won the British Touring Car Championship with Rickard Rydell driving the S40. TWR also aided in designing the road-going Volvo C70 coupe and convertible.
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