Small cars have had it good for quite a while, but the market could undergo a drastic transformation with the advent of ultra-cheap, small cars led by the Tatas’ Rs 1 lakh model.Impressionistic media reports and hints from carmakers point to a stripped-down car perhaps with a 30-horsepower engine, in the range of 700 cc engine displacement with three cylinders.
It will have a capacity of four or five passengers. Bosch is said to be designing a special fuel-injection system for the petrol version and a crdi unit for the diesel version.
Industry response has been cautious. Practically all of India’s manufacturers offer or plan to offer a variety of small cars in different price ranges. For a long time, the Maruti 800 model of Maruti Udyog Limited has set the bottom price, now at Rs 2.16 lakh for the base model. Without taxes its cost can go down to Rs 1.4 lakh. Currently, nearly all Indian small cars are in the price range of Rs 2-4 lakh. In relation to the global price range all these cars fall below the us $10,000 tag. The Tatas will add a layer at the base of the pyramid, with a production capacity expected to exceed 350,000 units annually.
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