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LATEST DELHI 2008 UPDATE: Tata has unveiled the Tata 1-Lakh Car and has named it the Tata Nano. Click here for the latest details on the new Tata Nano.

Here are some supposed details of the Tata 1 Lakh Car (Rs 1 Lakh is equivalent to USD2,500) that is supposed to be ready by July 2008. A design sketch of the Tata 1 Lakh car has been shown to selected members of the media sometime earlier and is said to resemble a egg shaped car with a tall roof.

Now Overdrive reveals that the Tata 1 Lakh car will resemble a production version of Tata’s 1998 Zing concept car. It will be a 5-door hatchback but there will be very little space behind the rear seats for a boot. In fact, even rear bench space is expected to be at a premium, making the car a 2+2 of sorts.

Definitely a pure A to B city car with the distance between A to B limited to short journeys where you do not need to carry any luggage. Not a balik kampung car, definitely. The car will be built on a rear engine rear wheel drive platform and will be powered by a two-cylinder engine.

Two of these two-cylinder engines will be offered - a 660cc 2-cylinder petrol and the world’s first low-cost 700cc two-cylinder common rail diesel engine with a special low cost common rail system developed by Bosch. Bosch will also apply a fuel injection system called “value motronic” for the 660cc petrol unit.

Apparently in internal company tests, the petrol version managed to achieve a fuel efficiency of 26 km travelled per liter of fuel consumed. The diesel version is expected to be even better.

As for the car’s name - sources in Tata say the current most favoured name within the company is the Tata Jeh, named after Tata’s previous chairman, Jehangir Tata.

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LATEST DELHI 2008 UPDATE: Tata has unveiled the Tata 1-Lakh Car and has named it the Tata Nano. Click here for the latest details on the new Tata Nano.

While countries around the world are competing to see who will play host to the tallest building in the world, something similiar is happening in the automotive industry: with every new small economical car announcement the target price level is being set lower and lower, with the latest being Tata Motors Ltd’s planned US$2,500 (RM8,600) car.

Tata’s head of sourcing for this project E. Balasubramoniam says the new project will redefine the concept of an entry-level car and targets a million of these US$2,500 cars sold annually. Tata is still working on the car and a target launch date is July net year. Bala says the final price must be kept at the US$2,500 level or the business case for the car will collapse.

Previously, sketches have been shown to the media that seemed to resemble a small egg-shaped car with a high roof. These ultra-entry level cars are intended for developing countries and might even find a place in countries like ours - where the cheapest brand new car currently still costs more than RM20,000.

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If you think the Renault/Dacia Logan (shown above) was a budget car, wait til you see what Renault has in mind next. The guys at Renault are planning an even cheaper car that will cost around US$3,000. This ultra-budget car will be designed and developed in India, at a new “technocenter” soon to be established that will hire 1,000 engineers.

Apparently, development costs in India are very low. India has been in the Carlon Ghosn spotlight for awhile now. Earlier this year he said there is a fundamental difference in attitude to cost savings between western companies and Indian companies, and by this he means the Indian one is better.

This new budget car will be aimed at developing markets, and not intended for the European market. Let’s just hope it ends up looking better than the Logan.

Naza Automotive Manufacturing Sdn Bhd has plans to set up an assembly plant in southern India, possibly in Chennai. Chennei is home to a number of automotive plants like Hyundai, Ford, Mitsubishi, BMW, Mahindra and Apollo Tyres, and is base for 30% of India’s auto components industry and 20% of the Indian vehicle industry.

Naza plans to go international with it’s Naza Sutera and Naza 206 Bestari models, and India is one of it’s target markets. The Indian passanger car market is big - 1.3 million new car registrations in 2005 alone, and the middle class group of Indians who can afford to buy cars is growing. As import duties for cars in India is high, CKD assembly in India itself would be Naza’s best option to be competitive.

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Indian automotive manufacturer Mahindra & Mahindra and DRB-HICOM’s unit USF-HICOM (Malaysia) Sdn Bhd are currently studying a proposal to assemble CKD pick-up trucks via a joint-venture in Malaysia. USF-HICOM’s management is currently studying the feasibility, and in-depth talks have not been held yet.

USF-HICOM currently distributes the Mahindra Scorpio SUV in both petrol and diesel variants here in Malaysia. Mahindra’s pick-up truck arsenal includes the Mahindra Utility, the Mahindra NC640DP, the Mahindra Pik-up and Mahindra Pik-up CBC.

DRB-HICOM also distributes pick-up trucks from Mahindra’s main Indian rival, the Tata Group. DRB-HICOM’s unit Scott & English (Malaysia) Sdn Bhd sells RM60 million worth of Tata vehicles yearly. Previously, there was news about Tata assembling cars here in Malaysia, which might include the Tata Indica small-sized city hatchback.

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Related News:
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Proton and Mahindra strategic alliance

Business Times reports that Mahindra & Mahindra is in talks with Proton for a possible manufacturing and marketing alliance which may involve a strategic stake transfer.

Rumours are that Proton would assemble the Mahindra Scorpio and the Mahindra Bolero for the Malaysian market. There are also options open for a joint venture between Mahindra and Proton like India’s Mahindra Renault, which assembles and markets Renault’s Logan passanger car, which is sort of like Renault’s Proton Iswara.

Is this the strategic partner that’s to be announced by the end of month or is this a new development? The Business Times source did not quote any official statement from either of Proton or Mahindra, and Mahindra officials refused to comment on the development upon contact so this might just be a rumour.

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Tata Sons Executive Director Alan Rosling says Tata Motor is looking at various markets including Malaysia and is likely to set up an assembly line in Malaysia to assemble Tata passanger vehicles like the Tata Indica here in Malaysia.

Tata Motors is in talks with DRB Hicom which are already assembling Tata commercial vehicles here in Malaysia.

The Tata Indica is a small city-going hatchback that has enjoyed success including a partnership with Rover where Rover rebadges the Tata Incida under a Rover badge. It’s a 995kg car available with a 1.4 liter turbodiesel or a 1.4 liter petrol engine.

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Mahindra & Mahindra Ltd, who currently sells the Mahindra Scorpio here in Malaysia is planning to assemble pick-up trucks here in Malaysia in 2007. Assembly will be done through a joint-venture with Mahindra’s current distributor USF-HICOM (Malaysia) Sdn Bhd.

The Mahindra Scorpio is currently offered in petrol and diesel versions here in Malaysia. While it looks like a rugged off-roader, it actually has no 4WD ability. Not sure if the diesel variant has it or not, but the petrol one definitely doesn’t.

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Proton had attempted to enter the India market with talks with Hindustan Motors in 2003 but talks didn’t really amount to much. Now Proton has started talks again with Mahindra and Hindustan Motors for a retry at the market.

Proton MD Syed Zainal Abidin was reported to issue a statement to international media that Proton would re-look at China and India as the market in those two countries were too huge to ignore. Proton and Hindustan Motors has something in common - Mitsubishi as a technical partner.