The $2,000 question

A half century ago, Volkswagen's Beetle transformed the American automotive landscape by tapping a pent-up demand for no-frills driving. For the first time, U.S. car buyers were offered a stripped-down import car that was both economical to buy and fun and affordable to drive. Buyers responded by making VW's Bug an icon.

Today, some pundits are suggesting the Tata Nano, a vehicle not much more substantive or powerful than a motorized shopping cart, could be the Beetle of the 21st Century. Like the beloved Bug, the India-made Nano is built for the common man. The car was unveiled in India this year at the bargain basement price of about $2,000.

James Bell, publisher of Intellichoice, a new car cost guide, has seen more than a few low-price upstarts come and go since the heyday of the original Beetle. So he's not hesitant to weigh in on the Nano's chances of being exported to foreign shores, particularly to North America.

The chances for the Nano are nada in the U.S., he says, as least as the vehicle is configured now.

"It will need an infusion of refinements and crashworthiness - and more time in finishing school, if you will - to prepare it for the North American market," Bell says. "The vehicle as it sits now is not much more than a glorified, four-wheel moped."

Designed and built for a Southeast Asian marketplace, the Nano is selling briskly in its first months on the market in India, Bell reports. That's not really a surprise, given its competition. In India, the most popular way to get around is on scooters, some of which ply the streets with four or five riders aboard, he says. The Nano can sit four or five people a lot more comfortably than can a scooter and it offers a level of drivability, weather protection and crash resistance no scooter could duplicate.

The next step for the car may be in Eastern Europe. Nano's Europa version was recently unveiled as a concept car at the Geneva Auto Show, with the intention of convincing show-goers that the Nano is ready to make the jump to Europe.

The Europa Nano is a big upgrade from the one being sold in India, Bell says. For one, the Europa doubles the power of its Indian cousin's meek 36-horsepower engine. "Tata is also working to reengineer the chassis and platform to pass European crash standards, to allow it to be driven at higher speeds and to give it a more comfortable ride," Bell says. "The car they're marketing in India would never meet European crash and creature comfort standards. It's too rough for the European market."

If Tata can convincingly pull off this makeover, the Europa version of the Nano could be available on a limited basis within two or three years, Bell says. But availability is likely to be seen only in Eastern Europe. "It won't be offered in the U.K. or in Germany, which are more North American in their driving sensibilities," he adds. "But it might be offered in an eastern European country like Turkey."

It will take much more polishing to bring the Tata Nano to car buyers in the U.S. and Canada, Bell says. It's not that Tata as a corporate entity can't be competitive in the world auto marketplace (last year the company purchased Jaguar and Range Rover from Ford Motor Co.). Instead, it's that safety and driving refinements expected by North American drivers aren't easy to incorporate quickly. "It's similar to the Chinese, who promised a couple of years ago they would be in North America by now and they're nowhere close," Bell says. "You have a big learning curve to overcome."

To make the Nano marketable here in the U.S., Bell believes gas prices would have to soar stratospherically. The move toward frugality would have to be not just a trend, but an economic imperative. That would yield buyer demand for a car that conceivably would never venture onto a highway but would only be driven locally.

It's likely that ultra-small Smart-like vehicles from manufacturers much better known to North Americans will reach showrooms before the Tata Nano ever bows on U.S. roadways, Bell predicts. And when they do arrive, they won't be priced at anywhere near $2,000.

These cars, among them Toyota's Scion IQ and the Volkswagen Up! concepts, represent a new generation of sophisticated and affordable micro cars that may sell for base prices of about $10,000, with fully loaded models going for as much as $13,000. Bell suggests they will offer more in the way of equipment than the sub-$10,000 Nissan Versa that's largely been rejected by buyers for the lack of such niceties as air conditioning and stereos. "They'll have the creature comforts and safety standards, and American's driving styles in mind," he says.

And they will be created by carmakers that are cognizant of Americans' desire to have the best of both worlds, Bell adds. "They understand we want to get around inexpensively when driving locally, but still be able to decide to drive from Los Angeles to Las Vegas on a Saturday," he says. "We like that multi-functional quality."