NEW DELHI, Jan 15 (Reuters) - Tata Motors Ltd, India's biggest vehicle maker, said on Thursday it hopes to design the country's cheapest car priced just above a motorcycle in a bid to reach a much larger market.
Ratan Tata, chairman of the powerful Tata group, told a news conference at an automobile fair on Thursday the breakthrough project was at a conceptual stage and he hoped the new car would be priced at an affordable 100,000 rupees ($2,203).
"We would like to, not strip down a car, but start with a clean sheet of paper and produce a vehicle priced between a two-wheeler and a low-end car which could carry four or five people and comply with emission and safety norms," Tata said.
The country's cheapest car, the Maruti 800 mini-car, produced by the local unit of Japan's Suzuki Motor Corp , is priced at 185,000 rupees. Most motorcycle models retail at about 45,000 rupees.
Although the local market is packed with a host of slick new car models, India is a price-sensitive market where five million two-wheelers are sold every year but only about 600,000 cars.
The new vehicle could be a bridge between the two markets which a large number of low-income families could afford, Tata said.
It usually takes three years to produce a car from concept to commissioning, but this project could take longer as the company will need to experiment with new materials and production technologies, he added.
Tata Motors , formerly Tate Engineering and Locomotive Company Ltd, was set up in 1945. It is India's largest producer of trucks and buses and the third-largest maker of both cars and utility vehicles.
Mainly a truck maker for most of the past five decades, Tata Motors made a serious foray into carmaking in 1999, when it launched the self-developed Indica hatchback. ($1 = 45.4 rupees)