Two problems related to transmission gear slipping have been reported for the 2001 Volvo XC70. The most recently reported issues are listed below.
Normal driving, at approximately 142,000 miles transmission service required light came on after transmission began slipping and "clunking". Transmission failure on 2001 Volvo Xc70. $4,000+ repair, common to the 2001 Xc70 model.
Had a transmission software update that solved a neutral shift problem, where the trans would lurch into gear from a stop. Now the transmission slips as I drive, especially when turning a corner. If I accelerate normally, the vehicle revs then clunks into gear. The dealer on the trans shops say the trans needs to be replaced. Now, I have 183000 miles on the car and bought it, hoping it would be a reliable car. . . I was so wrong! I purchased the car for $16,000 five years ago with 64k on it. I now have about $12,000 in repairs into this car. Needless to say I am nowhere near happy or satisfied. This is, by far the worst vehicle I've ever owned. It is like a money pit. I just wish a company like Volvo, that once had a great reputation, would own up to the junk they are putting out and make some recalls. At this point, I will never purchase a Volvo again and am spreading the word. Come on Volvo, just own up to the problems and fix them. Do the right thing and you will be noticed. Do nothing and again, you will be noticed but not for a good thing.