Bajaj low-cost car not to cost less than Maruti 800: Rahul Bajaj

Bajaj Auto chairman Rahul Bajaj yesterday asserted that the proposed ultra-low cost (ULC) car would not cost less than the Maruti 800, in an indication that the car would not really be as ''ultra-cheap'' as it was earlier projected to be, nor a rival to the Tata Nano.

The current price of the Maruti 800 ranges between Rs1.9 lakh and Rs 2.32 lakh.

In July this year Bajaj, the second largest two-wheeler maker in the country, signed an MoU with global car majors Renault and Nissan to develop a ULC car for India and other emerging markets.

''A proper car costing less than the M800 is not going to work, and I am not talking about the price. My son Rajiv Bajaj is on record saying that we will try not to sell a product whose EBIDTA margins are less than 20 per cent,'' Bajaj said on the sidelines of the India Economic Summit yesterday.

According to Bajaj in the Indian scenario, ''one must sell at least 200,000 cars a year, otherwise it doesn't make sense to be a part of over 40-plus crowd of carmakers''.

The Nano, manufactured by Tata Motors is India's cheapest car with its base variant selling for Rs127,000.