You may never have heard of Bajaj Auto, but the Pune-based company is a major Indian vehicle manufacturer that dates back to 1945. It operates in some 50 countries and built its 10 millionth vehicle in 1995.

Now, the “auto” in its name has taken in the broader sense of the word since up until now, Bajaj has been manufacturing mainly three-wheel models and passenger carriers along with motorbikes.

Today, at the 2012 Auto Expo in New Delhi, it unveiled its first four-wheel car, the RE60 that according to managing director Rajiv Bajaj, is aimed mainly to owners of three-wheelers who want to upgrade their ride.

“We are not trying to make a car but a four wheeler meant to ferry people in cities,” Rajiv Bajaj, the company’s managing director told the Hindustan Times. “It is not an incremental but dramatic improvement over a three wheeler. There are over 5 million Bajaj three wheelers in the country today. That’s the market we are aiming for,” he added.

Bajaj claims that the RE60 will be the world’s cheapest car, though it has not yet divulged its price. The diminutive four-seater model is powered by a tiny 200 cc (0.2-liter) engine with 20bhp that allegedly gives it a top speed of 70 km/h (43 mph).

The RE60 weighs only 400 kg (880 pounds) and according to the company, returns an average fuel consumption of just 2.83 lt/100 km (83 mpg US) and emits just 60 g/km of CO2 – or, as Bajaj said, “half of what the small cars currently emit in our market”.

Bajaj had formed an alliance with Renault in Nissan in 2009 for the development of the no-frills, ultra-low-cost car, but the Indian company continued on its own after its partners voiced concerns about the quality of the product.

Naturally, the RE60’s closest competitor is the Tata Nano, which at its launch in 2009 was also billed as “the world’s cheapest car”. Although initially it seemed like the Nano would achieve its target of 25,000 units a month, interest waned and sales soon nosedived amid technical problems and some fire incidents.

Nevertheless, Tata, which also owns Jaguar and Land Rover, continues with the Nano, which it revamped last November. It remains to be seen if its mini car has found a worthy opponent in the RE60.

You can watch two videos right after the jump – and while our non-existent knowledge of Hindi prevented us from understanding the commentary on the second clip, it is much more extensive and shows many details of the car.

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