Renault-Nissan and Bajaj Auto of India will form a joint venture to produce an inexpensive automobile that would be affordable by India's rapidly growing middle class. The budget car, which would cost approximately US$2,500 (100,000 Indian rupees), will be produced at a factory to be built in Chakan in western India. The facility is expected to eventually produce 400,000 units per year. According to Rajiv Bajaj, managing director of Bajaj Auto, the new car will offer twice the fuel economy of existing products in the market, with the company aiming for approximately 60 miles per gallon. One of the projects chief competitors will be Tata Motors, which announced a vehicle with a similar price point earlier this year.
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