World’s Cheapest Cheap New Car

Can you really purchase a brand new car for $2,000? If the car is a brand new Nano, made in India by Tata Motors, you might just be able to drive one off the lot for a little over the target price of two grand. If you live in India, that is.

Tata Motors is a multinational corporation with its headquarters in Mumbai, India and factories in India as well as Argentina, South Africa and Thailand. The ambitious Indian manufacturer is the second largest automaker of commercial vehicles in the world. Tata is not a newcomer to vehicle production though, the company built its first commercial vehicle in 1954 and today is the world’s fourth largest truck manufacturer. Tata was also the company that purchased Jaguar and Land Rover from Ford in 2008. However, the company’s latest automotive offering will likely share very little with the luxury car lines they now own.

Tata has introduced the Nano in an attempt to address a growing market for an ultra-low-priced car in India as well as Asia and Africa. As the standard of living improves in emerging nations around the world, the demand for simple and affordable personal cars could be huge. Tata got the jump on competitors Suzuki, Renault, Toyota and Hyundai, who all have plans to introduce comparable small cars next year.

The Nano will debut this summer in India where some 200,000 orders have already been submitted, the largest advance order for a car in India ever. The first 100,000 Nanos will begin to roll out of the factory in July of 2009, with the rest of the production run to come very slowly as the manufacturer ramps up production lines over the next several years. Buyers can cancel their orders at any time, or they can earn interest on their deposits as they wait for delivery of their cars.

Although the initial price of the Nano was to be right at $2,000, the figure creeps up to around $2,500 as options and safety features are added. The price will also increase if the car is sold in markets like Europe and North America that require additional safety and pollution standards be met. But the Nano is still likely to be the cheapest car in any market for a while to come.

What do you get for $2,000 and change? The Nano is an Indian-designed, four-door, four-seat, sedan with a tiny 35-horsepower engine located just behind the rear (driven) wheels in a set-up much like the early Volkswagen Bugs. The gas tank and spare tire are up front just like the VW design as well. At 123-inches long, the Nano is about a foot longer than a Smart Car and over a foot shorter than a Mini Cooper.

The little 635cc, two-cylinder engine propels the lightweight (1,322lbs.) vehicle from zero to 100 km per hour in 23 seconds. Even though the Nano obviously lacks blazing speed and power, the steel-bodied car gets over 47-miles-per-gallon and produces the same amount of air-pollution as an average motorcycle. The Nano is not a “green car” in emissions ratings, but it does represent lower emissions than four people on motorcycles would generate, and thus reduces overall pollution in comparison.

Tata plans to sell the Nano in both Europe and North America in a few years, but only after it meets regional safety and pollution standards, which will probably push the price up a bit. What is certain is that the Tata Nano is the first player to take advantage of a developing ultra-low-price market segment that will surely become more crowed in time.

Leave a Reply

Your email address will not be published.