Wednesday, June 13, 2007

The Cheapest Car in History is Coming in 2008

The Model T (pictured above) put the world on wheels during its 18-year production run. More than 15 million were made between October 1908 and May 1927. The original list price was $850, but was progressively cut until a roadster sold for as little as $260 in 1925, which is $3,070 in today's dollars.

In January 2008, Tata Motors (TTM:NYSE), one of India's largest automakers, will reveal the world's cheapest car ever made, and "will earn a parking place in history alongside Ford's Model T, Volkswagen's Beetle and the British Motor Corp.'s Mini, all of which put a set of wheels within reach of millions of customers," according to this report in Forbes.

Tata is currently referring to the new vehicle as the "1-lakh car." A "lakh" is a unit of the Indian numbering system equal to 100,000, and so Rs. 1 lakh (Rs. 100,000) is equal to $2,460 at today's exchange rate (Rs. 40.65 per USD), or 20% below the inflation-adjusted cost of a Model T in 1925!

The affordable price firmly aims to market the car to families otherwise restricted to motorcycles, like the Indian family of six pictured below, perfect customers for the new 1 lakh car, which will be available by the third quarter 2008.

(HT: Sanil Kori)


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