Last year Tata Motors introduced a new mini-truck "Ace", which is selling so well that Tata now plans to increase the production capacity from 60,000 vehicles to 200,000. Now Tata Motors is moving ahead of the launch of an ultra-small "people's car".Cost will be around one lakh which will be affordable to a much larger portion of population in India.Tata"s targeted audience is young professionals (below the age of 40) who are using bikes & three whellers in their day to day life.

Analyst opion that "small Car at lower cost is going to open up a whole new manufacturing segment in India" & Volume will be key to success.

At present the lowest price of car in the country is Maruthi800 & its sales are sluggish.Mini cars from Tata's are expected to pose severe competition to Maruthi Udyog Ltd.