Ultra-Cheap Cars Are Coming – Even to the U.S.

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Arvind Yadav / Hindustan Times / Getty Images

Bajaj Auto launches new RE 60, which is expected to compete against the world's cheapest car - the Tata Nano, on January 3, 2012 in New Delhi, India.

The average price of a new car has been climbing for years. Thanks to technological advances, better gas mileage, new features for comfort and safety, and higher production costs due to wage increases, inflation, and a host of other reasons, a typical new car today is selling for over $2,000 more than a year ago. Even as the mid-market vehicle creeps upward in price, competition at the far low end is heating up, especially in developing countries: Some new cars are expected to sell for under $5,000.

Before getting your hopes up, it looks like the cheapest of the world’s cheap cars won’t be sold in the U.S. anytime soon. Not too far off in the future, though, American drivers may get to test-drive and buy a car with a sticker price under $10,000.

Here are three automakers making news with plans to dramatically reshape the low-price car market:

Nissan recently announced (via the Wall Street Journal) that it plans on relaunching the Datsun brand with vehicles that cost in the neighborhood of $3,000 to $5,000. That’s for a brand new car. Mind you that the average price for a used car is close to $12,000 in the U.S.

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But the basement-priced Datsun won’t be available in the U.S. because the automaker’s “bare-bones approach to comfort and safety” won’t fly here, reports the WSJ:

For that reason—and because Nissan has no interest in cannibalizing its existing sales—the company says Datsun cars won’t be sold in the U.S. or other industrialized nations, at least not initially. In those markets, regulatory and safety issues alone would virtually eliminate the company’s super low-pricing strategy. “If you go to the U.S., it’s not going to end up being $3,000,” Mr. Ghosn said.

Instead, Datsun is targeting emerging markets such as China and India, where drivers are unlikely to mind standard-only transmissions and sticky accelerator pedals, so long as the price is right.

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Word from Reuters is that Volkswagen is likewise interested in a large expansion into emerging markets, including China, Brazil, India, and Russia. The German automaker reportedly is looking into plans to create a budget car brand, with vehicles starting at around $6,500, in order to compete with Datsun and Renault’s low-cost Dacia models.

Volkswagen hasn’t announced anything officially with regards to the introduction of a new brand. But it has made ambitious growth plans public, including its goal to lead the world in total car sales by 2018. Strong sales in emerging markets would certainly help the cause.

The ultra-cheap Tata Nano—the no-frills $2,500 vehicle introduced in India in 2008—has failed to become a global hit thus far. Within three years, though, we may finally get to see whether American drivers will be interested in a “luxury” version of the bare-bones car.

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The Tata sold in the U.S., according to Automotive News, “will get a bigger engine and ‘more bells and whistles,’ including such features as power steering and traction control.” It’ll still be remarkably cheap by U.S. standards: MSRP is expected to start under $10,000.

Brad Tuttle is a reporter at TIME. Find him on Twitter at @bradrtuttle. You can also continue the discussion on TIME’s Facebook page and on Twitter at @TIME.