The world's largest automaker is looking to join Tata Motors and Renault's Dacia brand as purveyors of cheap new cars. Toyota has cultured a company model by building high-quality, reliable cars, and has gone upmarket with its Lexus brand to compete at the high end of the automotive spectrum. More recently, the automaker has attempted to target a younger crowd with its Scion subsidiary and now a fourth brand is being considered to cater to emerging markets wihtout sullying the Toyota's hard-fought image. The new car would be targeted at the Indian and Brazilian markets, and would likely be made at Toyota's plant in Bangalore.

Click above for a high-res gallery of the Tata Nano

Click above for a high-res gallery of the Tata Nano.

Click above to view more images of the Tata Nano

Fiat and Tata already have a joint venture to distribute commercial vehicles. If they can do the big stuff, why not the little stuff? Tata and Fiat are looking at an agreement to sell the Tata Nano outside of India in markets where Fiat has a strong presence.

If the deal goes through, and once the car is upgraded to meet Western standards, Tata can take advantage of the Fiat name, marketing, and dealer network. Fiat would probably have a big seller on its hands -- and a slice of every one -- since the car is still expected to maintain a healthy price advantage even after it gets beefed up.

The Tata Nano exudes frugality, and when you're trying to build a capable vehicle for a paltry $2,500, that's not exactly unexpected. Unfortunately for the Indian automaker, the quickly rising cost of steel may thwart plans to hit the magic price-point. The price of steel has risen by 50 percent in less than a year, and even though the little Nano is only 1,300 lbs, when you're making an econobox on the mega-cheap, every penny counts. Like US automakers have done in the past, Tata is looking to its suppliers to shoulder some of the financial burden. Amazingly, the suppliers are okay with that, provided that Tata does its share.

Click above for a high-res gallery of the Tata Nano.

Click above for a high-res gallery of the Tata Nano.

Indian carmaker Tata chose a site in Singur, India for the plant that would make the Nano, the world's cheapest car. Not long afterward, eleven petitions were filed in the Calcutta High Court stating that the purchase of the land for the factory violated the Land Acquisition Act of 1894. It was alleged that the government of Bengal forcibly took "fertile multi-crop agricultural land" from farmers for industrial use, which isn't allowed.