Tata Nano was launched as world’s cheapest four-wheelers and most of the car makers in India apart from Bajaj-Nissan-Renault Jv had vehemently denied competing in sub-compact segment with prices around Rs. 2 lakh (note that after the updated pricing, top model of Tata Nano now also is priced around Rs 2 lakh).
Even if the upcoming sub-compact cars do not compete with Nano, there is definitely a growing segment that revolves around this price tag. Maruti Alto is expected to face competition from upcoming H800 from Hyundai Motors India Limited. Hyundai has announced that it will introduce the car in 2012 which will be an 800cc car placed below Hyundai Santro.
General Motors is also planning to introduce a similar 800-1000cc car which will be developed in association with SAIC which is the Chinese partner of General Motors in China. This car will be essentially developed for the BRIC market.
Tata Motors is working on Project Dolphin which will deliver a car that will fill the gap between Tata Nano and Tata Indica. Volkswagen Up! is also slated to be launched in India in next two years. Smaller models from auto makers like Fiat, Nissan and even Maruti Cervo is also expected in the Indian market in next 12-18 months.
