The most inexpensive car in the world has sparked a new way of thinking for global carmakers, including General Motors. India’s Tata Nano is making a solid case for building small, super low cost automobiles for the masses. The Nano’s approach is so revolutionary—making a well conceived, efficient commuter car available for less than $2,500— some analysts equate its impact to the that of the Ford Model T.
After the success of the Chevrolet Spark, a small $7,000 car in India, GM now plans a second small car offering, a move apparently influenced by the Tata Nano. But the automaker insists that the new model will not be a direct competitor to Tata. The new car is expected to sell at a price between the Spark and the Nano.
“We need something lower than what we have now,” GM group vice president David Reilly told the Business Standard of India. “I think if we could find a vehicle for less than that, it would not only benefit India but could benefit other places also.” Details on the new small car model are being kept under wraps. GM expects to introduce the car within the next two years.
Currently, small cars account for 75 percent of new car sales in India, led by automaker tag-team Maruti Suzuki. But the car market is still relatively untapped with respect to consumer demand in India. As developing countries offer the potential for explosive growth in affordable personal transportation, more manufacturers are likely to consider the new small car formula modeled on Tata.