This is an electrical issue. Either a dead battery, or ground to engine/frame problem. The ignition switch failing a 2nd time is questionable. Is the car parked outside in the rain?

Time to get a different car! It is hard to trust this one. Please report it to Volvo regional office, or use email http://volvo.custhelp.com/app/FormFramed

And go to http://www-odi.nhtsa.dot.gov/owners/SearchResults?prodType=V&searchType=PROD&targetCategory=A&searchCriteria.model=S40&stats=203019%2C1%2C2%2C131%2C53%2CS40&makeStats=&jsonBaseURL=%2Fdownloads%2Ffolders%2F&searchCriteria.model_yr=2000&searchCriteria.make=VOLVO&searchCriteria.prod_ids=203019





Scroll down to #6 below:

http://www.carcomplaints.com/Volvo/S40/2006/electrical/electrical_system.shtml

For those that don't want to go farther, here is the text of #6:

2006 Volvo S40, fwd T5: My wife was driving on the interstate around midnight going approx. 75-80 mph when all of a sudden her car shut off. When I say shut off I mean the headlights, dome lights, engine....anything that was electrical completely shut off. This would include the steering wheel locking up. So imagine driving in the middle of the night at 80 mph with traffic around you and you're lights going out, steering wheel locking and having no way to control the vehicle. To me this sounds like a 80 mph invisible torpedo that could have killed a few people including my wife. I had the vehicle towed to the nearest dealership which was a Ford dealership and the next morning they diagnosed it as a dead battery, which they were correct. Now I'm no rocket surgeon by any means but to me this sounds like a flaw in the safety dept. Somewhere. Something as trivial as a dead battery would cause a catastrophic failure like that? I think it's something that needs to be brought to the attention of the manufacturer and some sort of quality control as well.
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Keeping it running is better than buying new