New Delhi - Germany's Volkswagen AG and Suzuki Motor Corp plan to develop a new small car costing between 4,300 and 5,400 dollars for the Indian market, a newspaper reported Friday. Suzuki, which has a 54-per-cent stake in India's leading auto group Maruti Suzuki may replace its top-selling Alto model, a company executive told the Economic Times newspaper.
"At some point we will need a replacement for the Alto. That price range is the entry level for Indian customers today, so we can't leave that segment open," Maruti Suzuki chairman RC Bhargava was quoted as saying.
The report said the car would be priced at between 200,000 (4,300 dollars) and 250,000 rupees, which is twice the price of Tata Motor's Nano, the world's cheapest car, which was launched in March.
The car is also to be priced between 4,000 and 5,000 dollars in the European market, the cheapest from the VW stable below the Up, which costs around 8,800 dollars.
"Volkswagen will be greatly interested in a car below the price segment of the Up ... that is something we will need to check in our future together with Suzuki," VW spokesman Fabian Mannecke told the newspaper.
Suzuki and Volkswagen agreed Wednesday to a tie-up creating one of the world's largest auto alliances and boost their presence in the Asian markets.
Under the deal, VW is to pay 2.5 billion dollars for a 19.9-per-cent stake in Japan's fourth-biggest automaker.
