Jan Wilsgaard designed what would eventually become the 164 in the late 1950s as a concept car called the P358 and powered by a V8 engine.

The interior featured a simulated woodgrain dashboard face and leather seating surfaces.

[3] The 164 compared favourably in terms of fuel economy with similarly sized 6-cylinder European cars such as the BMW 530.

[5] The instrument cluster changed slightly with the introduction of the bulb failure indicator and the fuel gauge received revised markings with the 1/2 mark moved to the centre of the gauge and the red reserve section shrinking significantly.

The PRV engine was not immediately able to meet Federal emissions standards, so the 164 was kept in limited production for one more year for the American and Japanese markets – although only small numbers were sold.

The 164 received new, larger six-panel rear lamps sometime during the 1975 model year, electronic ignition, new seats, electric windows in the front, a new style of badging, extensive changes to the rear suspension, and the parking brake handle was moved from outboard to inboard of the driving seat.

In 1972, Bosch's first volume-production electronic fuel injection system, D-Jetronic,[6] was offered as optional equipment.

Like other fuel-injected Volvos, the 164E models gave improved performance and driveability with less toxic exhaust than their carburettored counterparts.

From the cowl rearward, body sheetmetal is identical with the exception of the remote shifter transmission tunnel, which was added to the 140 series in 1972.

The resulting two-door "162" with a chopped and vinyl-covered roof—features that were eventually applied to the 262C—is on permanent display at the Volvo Museum in Gothenburg, Sweden.