New Delhi: Two-wheeler maker Bajaj Auto Ltd and the Renault-Nissan alliance have not yet fixed a price for the small car they are developing jointly, and the $2,500 (Rs1.1 lakh) tag is only a notional value, managing director Rajiv Bajaj said on Wednesday. “Whether it is a (Rs)1 lakh car or a (Rs) one-and-a-half lakh car is not important,” Bajaj said on the sidelines of the launch of a three-wheeler platform.
The $2,500 price for the car, which is to roll out in 2012, is a notional value he and Carlos Ghosn, chairman of both France’s Renault SA and Japan’s Nissan Motor Co. Ltd, have agreed on, he said.
The final price would depend on factors such as the price of raw materials and the eventual make-up of the car.
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Ghosn was quoted by a section of the media as saying last week that the alliance was “aiming for a price of $2,500”.
Bajaj said fuel efficiency and cost of maintenance are as important to the success of the car as the initial price. “If people who own a two-wheeler have to move up to a four-wheeler, the monthly cost of ownership has to be affordable,” Bajaj said. Ghosn had said in a November interview with Mint that Bajaj Auto would be mainly responsible for the design, engineering and manufacturing of the car while the Renault-Nissan alliance would handle marketing and sales in and outside India.
Bajaj said that going by his experience in the two-wheeler business, it made little sense to launch a small car unless it can give 50% better mileage than other similar vehicles.
Small cars in India have an average fuel efficiency of 17km per litre. Bajaj wants to lift that to around 30km a litre for his small car with Renault-Nissan. Its closest rival in both price and fuel efficiency would be Tata Motors Ltd’s low-cost small car, TataNano, which has an average mileage of 23.6km per litre, according to Automotive Research Association of India (Arai).
For Bajaj, one way to enhance mileage would be to use the improvements the company has made to its two-wheelers. The 100cc Bajaj Discover motorcycle emits 26g of carbon dioxide per km, according to Arai, which has certified it as the world’s most environmentally friendly motorcycle. In comparison, cars emit close to 200g of carbon dioxide every km. Bajaj plans to limit his small car’s emissions at 100g of carbon dioxide per km. “If our car does 30km per litre, the carbon dioxide emissions will be in double digits,” he said.