Bajaj Auto, India’s second largest two-wheeler maker by sales, on Wednesday said there is

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no change in plans to manufacture the $2,500 ultra low-cost (ULC) car from a new plant to be constructed at Chakan near Pune.

“The ultra low-cost (ULC) car project is proceeding as planned and is on schedule,” S Ravikumar, vice-president of business development at Bajaj Auto, told Financial Chronicle.

He said Nissan’s alliance with Ashok Leyland was for a different concept car with a different price tag ($4,500-5,000).

Ravikumar did not comment on the two-year delay in the project. Agency reports on Tuesday from Geneva, had quoted Nissan executive vice-president Collin Dodge as saying “the physics of the car is very difficult. We have not yet found a solution, as there are a lot of engineering solutions required”.

Bajaj Auto said Carlos Ghosn, CEO of Renault Nissan and Rajiv Bajaj, managing director of Bajaj, Auto had agreed on the broad contours of the ultra low-cost (ULC) car project during their meeting in Delhi in January.

“The partners are aligned to the project and to the agreed objectives,” Ravikumar said in a brief statement on Wednesday.

The car was originally to hit the Indian roads in 2011, but the project was delayed due to differences between the partners on pricing and design.

Bajaj had said 70-80 per cent of the car parts would be common with those used in the Pune-based company’s motorcycles and three-wheelers to bring down the cost.

The car will compete with the world’s cheapest car Tata Nano priced a shade over Rs 1 lakh.

michaelgossalves@mydigitalfc.com