Why are 240s more desirable ... or more likable? IMO, it's not only an issue of styling, but of the build philosophy.
First, the styling:
The 240 essentially became a re-work of the 140, which was designed by Jan Wilsgaard back in 1961 or so. Had the 240 body become a production version of the 1974 VESC, I don't believe it would've endured as long as it did. The 140 was a very modern style for its day, and the styling remained very contemporary for Euro and Aussie cars all the way into the 1980s. On the other hand, the 700 body, which traces its styling origins back to approximately 1975, was essentially intended from Day One to conquer the US market, and thus its styling had more of a US-inspired flavour to it.
The almost-vertical rear window on 700 sedans is often referred to as an automotive stylistic oddity - which may be true for European cars, but not really so for US vehicles of the same era - e.g. look at some of the GM products of the early 1980s - especially the Cadillac Seville - and you'll see that US car designers were thinking the same thing as the design team of the Seven. But fashions change quickly, and what is chic one day often dates quickly. By the mid 1980s, sharp angles have given way to curves, and high bonnet lines got lower, rounder, and sleeker. So by comparison with the 140 /240, the Seven's design aged very quickly.
As for how they're built...
The philosophy of how the cars' components were built and designed is also somewhat different. Several components of the Seven were designed and made with the primary objective being lightness of weight, rather than having longevity in mind. Compare, for example, the fuel door of the 240 and of the Seven - it's unlikely that the steel fuel door and spring of a 240 will ever break or fall off of its own accord, but it's inevitable that the same item on a 700 has broken at least once during the life of the car. (The late 140s used the same fuel door as the 240s, and both of my 1974 examples still both have their original items). On the other hand, the 700 has this ridiculously-designed plastic part with a metal spring holding the thin piece of plastic of the door in tension, which is then attached to the body by plastic clips. This is a very minor example, but in my opinion it's a case in point of how the minor components of the cars were specified and designed differently. Silly little plastic things break in Sevens, which make the cars look tatty before their time; the 240's simplicity and solid stolidness means they've tended to age better.
And the upshot?
Perhaps the Seven is a little bit young at this point to become a classic; maybe opinions about the 700s will have changed in 10 years or so when there's not as many of them around. When i was a young lad, I always wanted a 760T, and had that wish come true when I lived in the US. But after having driven and owned many gadgets over the years, I'd never had as as much sheer fun as I had with my 140... which is basically a 240 with a double-wishbone front end.
As for the Group A side of things with the 700, there's a story to that. Text below, picture, and research by Björn Ohlson ©,
www.240grupp-A.se ®
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At the same time when the Infra Paint Volvo 240 Turbo was built another car was also built - a Volvo 760 Turbo Group-A, as this was to be the successor to the Volvo 240 Turbo. Tests were done to see how competitive the Volvo 760 Turbo really was, it was tested on several occasions but the 760 Turbo never got the chance to race on the track...
This 760 Turbo was put away for many years but in 1986 it became a exhibit object, for the Volvos museum at Hisingen Island, in Gothenburg here in Sweden.
In the fall of 1988, there was some people that wanted to homologate the Volvo 760 Turbo, to race the car in ETCC (Group-A). The idea was to use the 2 litre 16-valve engine with turbo, the B204FT engine (this engine was only produced for the Italian market). This because that FISA had changed the turbo coefficient from 1,4 to 1,7 for the WTCC-season 1988. This group of people wanted to homologate parts suchs as a new 5-gear Getrag gearbox, a multilink rear axle (that was in production), a rear wing, flat floor (a so called aerokit), suspension parts, turbo and a exhaust manifold and so on.
What needed to be done was to start production of a new Evolution-model of a total of 500 units (cars), of this Volvo 700-series, just described. The idea was to match the competition, in this case the new Ford Sierra RS500's. But Volvo Cars was not interested in this idea... Instead the 700- and 900-series was nationally homologated later in 1991. And with some help these Volvos became great winners.
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There are more pix of the Group A cars at Björn's site, which is very comprehensive. The body kit of the Group A 760T is interesting, particularly the lip on top of the rear window. It seems the 'boxy' shape of the 760 didn't need as many fibreglass additions after wind-tunnel testing as the VL Commodore to make it aerodynamic.