Would you like to buy Tata’s Rs 1 lakh car?

Tata Group chairman, Ratan Tata, poses in the company’s new Nano car during its launch at the 9th Auto Expo in New Delhi. The car, a hatchback with a 624cc engine, is priced at about 100,000 rupees ($2,500), half that of the current cheapest car in the market.

Would you like to buy Tata’s Rs 1 lakh car?

Tata group disclosed world’s cheapest car

India’s giant Tata Group was due on Thursday to unveil the world’s cheapest car that auto analysts say could turn upside down the cost of vehicles globally.

The long-awaited “People’s Car,” over which the company has thrown a shroud of secrecy, was slated to be unveiled at the start of India’s biggest auto show here by Ratan Tata, the 70-year-old tycoon who heads the tea-to-steel group.

Tata, whom the Indian media have likened to US automobile pioneer Henry Ford, has said he hopes the ultra-cheap car will “make a contribution to making life safer” for Indian families who often travel four to a motorbike — father driving, mother riding pillion and two children wedged in between.

The car, expected to carry a sticker price as low as 2,500 dollars could “revolutionise car costs downward,” said leading car analyst Murad Ali Baig. It “is bound to be followed by other low-cost ones.”

The four-door five-seater rear-engined auto, described by those who have seen it as boasting “cute” looks, is targeted at drivers trading up to four wheels from two as a booming economy creates new affluence.

The car on which Tata Motor engineers have cut costs to the bone has sparked a race among global automakers to come up with rock-bottom priced vehicles to appeal to this growing lucrative segment in India and other emerging markets.

The lightweight car has only one windshield wiper instead of two, no power steering, no power windows and no air conditioning, according to media reports and company comments.

Already Germany’s Volkswagen, leading Bajaj Auto and France’s Renault and Ford among others have said they planning or mulling new cheap cars for India where small autos comprise two-thirds of annual passenger vehicle sales of one million in the country of 1.1 billion.

India’s biggest carmaker, Japanese-owned Maruti Suzuki, has said it will not cut the price of the Maruti 800, its most popular budget model that sells for 4,800 dollars — the cheapest car now on the country’s roads.

Tata, which has been on an aggressive overseas expansion drive, is also expected to win its reported two-billion-dollar bid for the British Land Rover and Jaguar brands — which would put it in the unusual position of making two prestige cars as well as the world’s lowest-cost automobile.

Environmentalists see clouds on the horizon if Tata’s cheap car is a winner, fearing it will further jam up India’s clogged roads and add to choking pollution.

“With more cars you have more emissions and that adds to global warming — what we need is public transport,” said Souparno Banerjee, an official of Delhi’s Centre for Science and Environment.

But Tata says the car will create no more pollution than a motorbike. “If I can get a loan from my boss, I might buy the car so my family and I could travel, I can’t take my mother on my motorcycle any more — she’s too old,” said courier driver Daniel Abraham.

India’s Tata group to launch world’s cheapest 1 lakh car

India’s giant Tata Group will this Thursday unveil the world’s cheapest car, which analysts say could revolutionise prices worldwide.

Ratan Tata, the reclusive tycoon who heads the tea-to-steel conglomerate, will kick off an auto show here with the unveiling of the long-awaited “People’s Car”, which will carry a sticker price of 100,000 rupees or 2,500 dollars.

The cheap car is a pet project of the Cornell-trained architect Ratan Tata, who helped design it, and is aimed at getting Indian families off their motorbikes and into cars.

Ratan Tata, 70, has spearheaded the growth strategy of the company known for its philanthropic values.

“I hope to make a contribution to making life safer for them (the masses),” he said on its web site.

Small cars are expected to dominate the biennial auto show, which has become one of Asia’s largest and is expected to draw 1.5 million visitors, up from one million in 2006, organisers say.
“India’s auto industry has found a new confidence — the show can be seen as the automotive industry coming of age,” said Ravi Kant, president of the Society of Indian Automobiles (Siam).
Domestic and international carmakers have been in a race to corner India’s small car market, which accounts for over two-thirds of domestic sales in the country of 1.1 billion people.

Small car sales are expected to nearly double to around two million units by 2010 as India’s population becomes more affluent and trades up from motorcycles to cars.

The eight-day show features automakers from around the world from Honda, Ford, Hyundai and Volkswagen to luxury carmakers like BMW and Daimler, which are reaching out to India’s new free-spending wealthy in an economy growing by nine percent.

India’s automotive industry, which produces 1.5 million vehicles annually, is worth 34 billion dollars a year and contributes five percent of the country’s gross domestic product.

An Indian government mission plan aims for automotive sales to more than quadruple to 145 billion dollars by 2016, and for indirect and direct auto sector employment to grow to 25 million from 13 million today.

The new car to be unveiled by the Tatas could “revolutionise car costs downward,” said leading Indian car analyst Murad Ali Baig. “This car is bound to be followed by other low-cost ones.”
“A lot of people just want a car that takes them from home to the market, they don’t want something fancy or they want something small as a second car,” he told AFP.

Indian motorcycle maker Bajaj and France’s Renault are looking at making a 3,000 dollar car for the Indian market that would get 34 kilometers (21 miles) per litre of fuel.

Tata has said it is targeting its car at Indian and other emerging markets. The car would cost about half the price of its nearest rival in the Indian market made by Japanese-owned Maruti Suzuki that sells for 4,800 dollars.

A Tata Motors board member said the car would get 25 kilometres per litre of fuel. Tata has said it believes it could eventually sell one million “People’s Cars” annually.

Tata, which has been on an aggressive overseas expansion drive, is also expected to win its reported two-billion-dollar bid for the British Land Rover and Jaguar brands in January — which would put it in the unusual position of making two prestige cars as well as the world’s lowest-cost automobile.

Environmentalists see clouds on the horizon if the cheap car is a winner, fearing it will further congest India’s clogged roads and add to choking pollution. But Tata says the car will create no more pollution than a motorbike.

India’s car market is a huge draw because car penetration is just seven per 1,000 people compared to 550 per 1,000 in such countries as Germany or 476 in France, said Dilip Chenoy, Siam director general.