Tata Unveils World's Cheapest Car at India Expo

India's Tata Motors has unveiled what is being billed as the world's cheapest car — the $2,500 Nano.

At the 9th Auto Expo in New Delhi on Thursday, Company Chairman Ratan N. Tata said the four-person sedan, also called the People's Car, is an all-weather alternative to the motor scooter. He said he found inspiration for the vehicle on the streets.

"I observed families riding on two-wheelers — the father driving the scooter, his young kid standing in front of him, his wife seated behind him holding a little baby. It led me to wonder whether one could conceive of a safe, affordable, all-weather form of transport for such a family," Tata said.

What You Get for $2,500

The Nano, at about half the cost of the cheapest car now on the road, could bring automobile ownership to thousands of people who have been able to afford only a motor scooter, company officials said.

At about 10 feet long and 5 feet wide, the car accommodates four large adults comfortably, automotive reporter Murad Ali Baig told NPR — and it comes in a variety of colors.

It meets all safety and environmental requirements, Tata said. And, in these days of escalating gas prices, it gets a respectable 50 mpg and has lower emissions levels than the scooters now produced in India.

The Nano has rear-wheel drive and a two-cylinder, 35-horsepower engine, and can reach speeds of 60 mph, Baig said.

Keeping Costs Low

The basic version of the Nano is spare. There's no radio, no passenger-side mirror and only one windshield wiper. It has seat belts, but no air bags, and the rear-mounted engine means there is little storage space. Air conditioning is available on the deluxe model to cope with the brutally hot Indian summers.

Tata said the company was able to keep the cost of the car low by putting the plant in an area that receives tax concessions and having the suppliers set up plants nearby to cut transportation costs.

Company officials said the car will go on sale later this year. It initially will be sold in India.

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