Kez Casey | Aug 3, 2016

Reports out of India hint at a collaborative agreement between Volkswagen and Indian industrial giant Tata, working together on a new low-cost vehicle for the Volkswagen Group.

The project, which will lead to the development of an entry-levelbrand for markets like India and China, is reportedly back on Volkswagen’s radar after having been initially cancelled in the wake of Volkswagen’s emissions scandal, and the budget cuts that followed.

Now, German publication Manager Magazine reports that the project is underway again, with Volkswagen seeking Tata’s expertise having previously been unable to trim costs to fit budget targets.

The original Tata Nano
The original Tata Nano

The simple and cheap Tata Nano gained worldwide attention for its simple construction and low price, with current versions selling for between A$4000 and A$5900 depending on the model and specification.

In Volkswagen’s instance the new low cost car would likely form part of a family of vehicles to be launched under a new brand so as not to diminish the brand equity of Volkswagen’s other mainstream products.

Similar to what Renault has done with its cut-price Dacia brand, the new vehicle range could utiluse Volkswagen’s older platforms, repurposed with new bodywork.

Dacia sandero
Dacia sandero

To keep a lid on costs features more familiar to established markets, such as airbags and air conditioning won’t be part of the standard equipment list, but may at least be offered as optional equipment.

The range is expect to initially comprise a sedan, wagon, and people mover, with additional variants possible based on the success of those first models.

Previously Volkswagen had set an under-$10,000 price target for the low cost-brand, putting it in a similar price bracket to vehicles from Dacia, Maruti Suzuki, and Tata, albeit all larger and better equipped than the bare-bones Nano.

MORE: Volkswagen News and Reviews

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