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Bajaj Auto and Renault-Nissan Form JV To Build Ultra Low Cost Car

India’s Bajaj Auto and the Renault-Nissan Alliance are forming a joint-venture company to develop, produce and market an ultra low cost car—code-named ULC—with a wholesale price range starting from US$2,500.

The new joint-venture company will be 50% owned by Bajaj Auto, 25% by Renault and 25% by Nissan.

Targeting the growing Indian new vehicle market, the ULC will be made at an all-new plant to be constructed in Chakan (Maharashtra state) in India. Initial planned capacity will be 400,000 units per year. Sales will start in early 2011 in India, as a primary market, with growth potential in other emerging markets around the world.

The partners have already begun joint product development and the project is on line to meet targeted performance & cost.

In January, Tata Motors unveiled the long-anticipated Tata Nano—the low-priced Rs 1-Lakh (US$2,550) “People’s Car”—intended to expand greatly the market for automobiles in India. (Earlier post.)

Comments

Alex Kovnat

I am not thrilled at the prospect of low cost cars in India, or other newly-emerging countries.

Let's look at the tragedy of the automobile here in America. Excessive automobile dependence, which began 100 years ago with the introduction of the Model T, has resulted in massive destruction of human life and crippling injuries, particularly among young people. And then there's the problem of rapid exhaustion of the world's oil resources, along with the issue of carbon dioxide buildup in our atomosphere.

Today's young people in suburban life style situations here in America (and I suppose other countries too) are so dependent on the individually-driven automobile to get around, they are barely this side of not even being able to go to the bathroom unless they have a car, or unless somebody can drive them to the outhouse.

I am not cheering for the prospect of this same thing happening in India.

Harvey D

Alex:

Centuries ago many people had an ox or a mule and then a horse to get around and/or take their goods to the market.

Almost 200 years ago, steam locomotives arrived and trains replaced most heavy horse drawn wagons and stagecoaches.

For many more years, major individual transport means were horses and bicyles.

Then came motorized coaches (cars) with progressively more speed and protection against sunshine, wind, rain and snow. Some 120 years latter, there are more than 800 million ICE vehicles being used as personnal transport and the number is growing fast.

Within 5 to 10 years we will have over 1 billion vehicles being driven around the world. That number will probably double again by 2050. I doubt very much that you and I will see any reduction in the number of vehicles. However, we will see a progressive switch from ICE to electrified vehicles, specially from 2010 onward.

Instead of less vehicles, we will see hundreds of millions of new very low cost, light weight BEVs (1500 to 2000 Euro) produced in China and India. Those vehicles will quickly be distributed thoughout Asia, Africa, Latin America and Eastern Europe. They will become the new VW of the world.

Too many Americans, Canadians, Australians, Euopean Common Market Countries people will resist the change in behavior and will attempt to carry on as usual with their oversized gas/energy guzzlers. Eventually, the majority of us will also adapt to smaller, lighter electrified vehicles. Our many Al Gores will continue to drive 3+ ton ICE monsters and/or PHEVs until such times as 100+ KWh battery packs become available.

litesong

Hi Harvey D...I'm really enthusiastic for EVs, particularly with increasing renewable energy sources coming online. But like you, I fear the gas guzzler people, if & when we can convert them to EVs, will just want electric guzzler vehicles. Yes, your '100+KWh' comment needs a real emphasis on the '+'....maybe even '++++++etc.'.

eric

"Instead of less vehicles, we will see hundreds of millions of new very low cost, light weight BEVs (1500 to 2000 Euro) produced in China and India. Those vehicles will quickly be distributed thoughout Asia, Africa, Latin America and Eastern Europe. They will become the new VW of the world."

There is no need for unrealistic, far-fetched predictions like this. Given that GM can't even build a semi-BEV for less than $50,000, even Chinese and Indian car companies can't build it for 20 times less than that. Never mind the fact that many Indian villagers barely have any access to electricity at all, or the fact that both these countries' reliance on coal-fired electricity means your BEV scenario is just as much of an environmental disaster as a predominantly ICE business-as-usual future. also doubtful whether such BEVs could displace ICE vehicles in places such as Brazil which already have alternative fuel infrastructures in place. their popularity in Africa is also farfetched, as in many places the electrical grid is non-existent or in a very poor state of repair.

Jonas

Sadly, this is the future. Tens of millions new, ultra-low cost ICE vehicles.

Forget the cheap EV scenario. It will never happen. The price of batteries is not going down fast enough. The group of lower middle class people able to afford a $2500 car is growing much faster.

This will result in automakers perpetuating the ICE in these developing countries.

So the scenario will be dirt-cheap Nanos running on high blends of ethanol or biodiesel.

Ross

Has anyone ever noticed how times has changed. in the 1700s, we used horses, had sail boats, pony express, candles, swords.

1800s, wagons, steam engine boats, tele-graph, oil lamps, mussel loaded coal powder guns.

1900s, automobile, Air craft, Space craft, I.C.E., telephone/vision/radio, incandescent electric light bulbs, gunpowder guns and lasers.

2000s, now we seem to be going to the Electric car, cell phone/computer/internet-radio/T.V./E-mail/news-paper, Florescent electric light bulbs.

I think right now people know the immeadete future of the auto industries is going to go to completely electric, but their just looking around at our options for alternate fuels that might offer use a way to make a car affordable to the general public and one that will also help to not make more CO2 and nitrus-oxides.

What I am mostly sick of hearing is how the other countries is trying to put SOMETHING out there on the market place for the people, but the U.S. seems to be eather just sitting on their hands or making some car that gets a redicules price tag that only 1% of the public can obtain or reach with their budget they have to work with today.

The big 3 has NOT EVEN came up with 1 car on the drawing board that they can put into production within this year or next year, that is affordable to the general public.

One thing I find intresting is the fact that india has never been big on cars or there production. Why all of a sudden are they sooo intrested in building cars now? Probably because they see the big 3 is not really trying to produce something affordable so india see a market now in the U.S. (someday)

Ever notice how these little great cars are being made over seas in other contries, but their not talking about selling any/many in the U.S..

Toyota and Honda is the only ones really trying to market their cars here in the U.S. TODAY. Where is the big 3? Why dont one of the big 3 have a little $2,500 dollar car like Tata Motors has in india. I dont need all the luxuries to get to work and home or schools, but I also dont need the ultra-high redicules price tags eather. Overseas auto companies have built a car that will run on just about everything from compressed air to electric to organic oil fuels. Why cant we seem to make one?

Harvey D

eric & Jonas:

Did you know that Kenya (Africa) is the country with more (locally made) PV panels in operation in the world? Just about every house got one or two. It is becoming the main source of energy.

If Kenya can do it, so could (eventually) the other 30+ countries in Africa.

What could be best for mobility in Africa and many other countries may be very low cost BEVs and Solar panels. Both will eventually be mass produced in Africa, India, China etc. Sunshine is plentiful in most of those places.

The price of lithium BEV batteries (or other type of ESSUs) will go down from $1000 (USD) per KWh to $100 (in 2007 USD) within 8 to 10 years. China can do it for $300/KWh already. The very low price cars of the future will be simple, basic low cost BEVs. The fuel will be solar energy from very low cost PV panels. People will swap standardized batteries (modules) between home, spare, vehicle and charging stations.

Rich people will still drive large fossil or agrofuel guzzlers for many years, even decades, but that will not be the majority. Eventually they will be driving large deluxe BEVs.

Jonas

Harvey D, according to the WRI, photovoltaics make up only 0.1% of Kenya's energy mix. Biomass is the leading renewable source, generating 11,000 times as much power.

So I'm not sure where you get your data from.

Solar panels are 20 times costlier than alternative renewables and fossil fuels. They can never support an electricity infrastructure. At best they can be used for lamps. But they will never provide baseload or peakload power.

Perhaps concentrated solar can do this in the future, but the number of projects is small (1 or 2 commercial and heavily subsidized plants in Europe, 1 or so in the U.S.)

Sorry, I'm not buying your electric car scenario in Africa. It's baseless.

Less than 10% of Sub-Saharan Africa's population even has access to electricity for starters.

Half of Africa's population earns less than $1 a day.

Clearly, EV's in Africa are a total fantasy.

The Bajaj Pulsar motorcycle developed by the good folks at Bajaj is a really good bike. It sells like hot cakes all over South Asia, Africa and Latin America.
So, we can expect that their little ULC car will be a really fine product too, when it comes along on 2010.

Harvey D

Jonas:

An electric vehicle may have 2, 3 or 4 wheels and does not have to be an electrified 3+ Ton Hummer.

Where complex electricity grids do not exist, individual home (or collective) solar cell systems may be the best way to get the low level essential electric energy for a small house and very small e-vehicle.

Look at what happened with cell phones. Millions of people who never had a phone jumped from nothing to cell phones.

That could happened with vehicles, starting with a basic e-bike, low cost e-scooters, low cost e-3 wheelers and very basic e-4 wheelers. All our very expensive and heavy safety features will wait until more energy and funds are available. The first Fords did not have all those goodies either.

Let us not underestimate progress in Asia, Africa and Latin America. As some older economies stagnate, other countries will more rapidly embrace the new electricity based economy and may evolve more quickly. The movement as started in China, India, and many other countries.

N BURAGOHAIN

I wuold like to be a dealership of Auto (Three wheeler)
in my place like Lakhimpur district of Assam , Please let me know about your requirment to become a dealership of said items .

Thanks


N BURAGOHAIN
C/O R N BURAGOHAIN
WARD NO 2 Rly STATION ROAD
NORTH LAKHIMPUR, LAKHIMPUR
ASSAM, PIN 787001

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