How cheap can they go? New tiny car planned in India

LOS ANGELES — In the race to make the world's cheapest car, the Indian company Tata Motors might soon lose its No. 1 status — from a manufacturer in its own country.

Motorbike manufacturer Bajaj Auto Ltd. is coming out with a compact vehicle, the RE60 hatchback. Although the company didn't specify a price when it unveiled the vehicle last week, chances are that it'll be cheap.

Bajaj even insisted that the RE60, which probably will be used most often in urban locales, be called a "four-wheeler" instead of a car.

The vehicle will feature a 200-cc rear-mounted gasoline engine and will be able to reach about 43 miles per hour, according to the Times of India. Bajaj, which already exports more than half the 520,000 three-wheelers it makes each year, expects the RE60 to do brisk business abroad.

Commercial production could start in the next few months, Bajaj said. The vehicle was dreamed up by the manufacturer in conjunction with Renault and Nissan as a potential competitor to Tata's Nano, which often costs less than $3,000 in India.

But Bajaj eventually went on to develop the four-seat RE60 on its own and said Tuesday that its partners could abandon the vehicle if they didn't like it.