King Banaian responds to my Tata Nano post.
His point about the poor in America benefiting from a cheap but new car is worth considering. Cars are an important mode of transportation for working poor who aren't well-served by the disconnects between low-income housing and jobs. (See also the Growth & Justice paper on this topic [PDF].)
But as far as I'm concerned, this wonder car for the U.S. market exists on paper in King's demand curve and in the promotions of Tata.
I see no evidence that the company thinks it should be able to sell the car for $2,500 in the U.S. Note that all the statements about price lump together regulatory requirements and model upgrades for the market. Tata likely doesn't want to reveal where its own costs are for competitive reasons.
UPDATE:
King is correct about some of the pitfalls of cheap used car ownership, but he missed one advantage these have over this Tata Love Bug. When the poor lose their marginal jobs to overseas labor, they still have a vehicle large enough to haul their possessions to a cheaper apartment — or to sleep in.
Try that with your heaterless Nano.
