Undeterred by the scepticism from auto majors, Tata Motors on Thursday said work was underway to develop a very low-priced, entry-level car.
"The Rs 1-lakh car is under development," Tata Sons Chairman Ratan Tata said.
The statement came after Deputy Prime Minister L K Advani urged the Indian automobile industry to come up with low-budget car costing around Rs 1 lakh, while inaugurating the Auto Expo in New Delhi.
Pointing out that automotive products were still far too expensive for most of our rural population, Advani said: "The challenge before you therefore is to bring down the cost of the vehicle and make them more affordable."
Suzuki Chairman S Nakanishi had doubted the idea to make an entry-level car with Rs one lakh price did not seem feasible, but MUL would meet any challenge posed by the Tata company at the entry-level car.
Earlier Tata Motors vice president (commercial) Rajiv Dube had remarked: "All the best to Maruti," when asked about Maruti's assertion that it would meet the challenge of Tata Motors to develop Rs 1-lakh car.
The project is on and it may take up to 3 to 5 years for the development of the car, company officials had said earlier.