GM May Build Low-Cost Nano Rival For Asia

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General Motors is reportedly developing an ultra low-cost family car designed for emerging markets, similar to the recently launched Tata Nano which sells in India from about $2,500. GM is unlikely to match the Nano’s price tag but something around the $4,000 mark is entirely plausible.

"When Tata Motors in India came out with their $2,500 Nano vehicle, it put a lot of automakers on the spot," said Nick Reilly, GM's newly installed executive vice president, international operations. Reilly also confirmed that GM was looking at lower cost vehicles, primarily for Asia, but stated that no final decision had been made.

Previous reports have suggested that GM would use the platform for its upcoming 2011 Chevrolet Spark for the new low-cost car. Engineering and production would be handled by GM Daewoo Auto & Technology Co. in Korea or GM’s division in Brazil. There are unlikely to be any plans, however, to bring the budget car to the U.S. or other western markets.

As for the upcoming Chevrolet Spark, the five-door minicar will first go on sale in South Korea and Europe early next year, and eventually reach the U.S. by 2011. At launch, there will be the choice of two four-cylinder gasoline engines displacing 1.0 and 1.2-liters, rated at 66 and 78 horsepower respectively. No independent testing has been conducted but the Spark is expected to average 40 mpg in fuel economy.

[Wall Street Journal]