World's cheapest car unveiled

An Indian auto maker has unveiled the world's cheapest car, leading the drive by manufacturers to develop small, cheap vehicles

The Nano car will retail at about £1,300 (100,000 rupees) and is targeted at the Indian market. Its maker, Tata Motors, is part of the Tata industrial conglomerate that is in talks with Ford to buy the Jaguar and Land Rover brands in the UK.

Volkswagen, Toyota, Honda and Fiat have all said they are looking to build low-cost cars, while the Renault-Nissan alliance is developing a $3,000 (£1,500) car with Indian company Bajaj Auto.

US car giant Ford announced this month that it would invest $500m in India to make a small car.

The four-door, five-seater car, which goes on sale later this year, has a 33bhp, 624cc engine at the rear. Tata will initially make about 250,000 Nanos and expects eventual annual demand of one million cars.

Image: The Tata Nano will appear in a deluxe version

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