Economy Cars from 1901- 2009

by nidhi on November 30th, 2009 1

Economy car is the one which has low buying price and very low maintenance cost. Automobiles which are generally small in size with less weight and low cost fall into the spectrum of economy cars.

History shows that the first economy car Oldsmobile Curved Dash” (image shown below) hit the market in 1901. This car had double seats and was basically inspired by the pickup truck.

But Ford Model T”, launched in 1908, is considered as the first true economy car by the very fact that it had inexpensive design, innovative production technology (famously known as assembly line) and used less expensive materials.

As the technology advanced from 20th to 21st century, the economy cars also improved a lot. Today we see many variations of economy cars. However, the basic tenet for a car to be an economy car remains the same i.e., low cost.

Why are economy cars gaining popularity?

Today, the ‘middle-class’ category is attracted by big companies and most of their products are targeted towards them. The reason is they are more in number and they don’t bother in spending money since they love to eat out, drive, go to theaters, also to buy non-durable goods. Hence, over the last few decades,these companies decided even to produce low cost cars that are affordable for them.

Following are the key points that show why economy cars are gaining popularity these days.

Needless to say, economy cars are inexpensive.
They have attractive outer and inner designs.
Small in size but good enough for a family.
Easy availability of funding through bank loans.
Good performance achieved through state of the art technology.
Longevity or durability.
Emergence of developing countries in the production and manufacturing arena.
Increased competition amongst manufacturers.
Ease availability of cars.

Modern day economy cars

Due to fragmented market, today we see many players coming up with economy cars to cater the ever growing need of the middle class. Today, we see big players like Toyota,Hyundai, Mercedes-Benz, Renault, Ford moving into “economy cars”. Other players like Kia, Fiat, Peugeot are also making big in this segment. But undoubtedly, the most famous one in the lot is “Tata Nano”. Tata Nano, so called, people’s car is manufactured by the Indian company, Tata Motors. Tata claims Nano to be the cheapest car in the world by pushing forward a price tag of $2,500.

Moreover, these days we see many players resorting to hybrid models, powerful diesel engines, electronic engine management (automatic one), to cut down cost and at the same time increase the efficiency of economy cars.

Challenges for economy car producers

The biggest challenge for all the economy car producers is the ‘global recession’. We have seen many big players like Ford, Chrysler and GM suffering a lot due to fall in demand from buyers. This is the biggest challenge they face these days.

Following are some other challenges for economy car producers.

Expectation of almost all the features in economy cars at the least cost.
Need of highly comfortable and very safe cars.
Good seating capacity i.e., a car small enough to carry off the entire family members.

Think about the traffic block if every one get a car for themselves. We can reach no where even if we have a car.

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