25 Mar 2009

'World's cheapest car' to hit the roads by July

10:23 am on 25 March 2009

India's Tata Motors has officially unveiled what it says is the cheapest car in the world.

The Nano will hit Indian roads in July and, with demand set to far outstrip supply, the first 100,000 owners will be picked at random and pay a guaranteed price of about $US2,000.

Launching six months behind schedule and with production in the first year severely constrained, it will take over a year to deliver the first 100,000 Nanos to an otherwise subdued market.

Since the Nano was first shown, its main production plant had to be moved following land protests, the company posted its first loss in seven years, its shares have dropped 70% and its credit rating been downgraded with the threat of further downgrades remaining.

The basic version, excluding taxes, will be 100,000 rupees, or $US1,980. But once taxes and dealers charges are included, the Nano will be in showrooms for 112,735 rupees in some parts of India, while top-end models with air conditioning and other extras will cost close to 200,000 rupees.

A European variant will be launched by 2011, and the company is also looking at the United States as the economic situation has made low-cost cars even more attractive.