In the summer of 1970, the T 600 was replaced by the improved T 650 in many respects. The engine was a new 4-cylinder 4.2-liter unit with 73 horsepower (a couple of years later, the power was increased to 78 hp). The hydraulics were more efficient than before, and the steering was hydrostatic. The biggest innovation, however, was the advanced, thin-sheet metal construction and quiet cabin, which was a completely separate unit from the rest of the tractor. The quick gear shift was initially a standard feature and later, after the T 600 was discontinued, it became an optional extra. Other standard features included telescopic hitch ends, adjustable steering wheel tilt, and power take-off. The T 650 was at the time a very heavy tractor, nearly 4000 kg.

The brand name changed from BM Volvo to Volvo BM in 1973. In the spring of 1975, the Terra Trol II hydraulics with hitch sensing was introduced.

In the spring of 1976, a turbo version of the T 650 was introduced, named the T 700. The transmission was also strengthened to handle 90 hp, and lifting capacity was increased (also for the T 650). A four-wheel drive model never came to be, and production of the T 650 and T 700 ended in 1982. A total of just over 30,000 of these tractors were made.

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