According to our list of the cheapest cars in the world, Fiat already offers the ninth least expensive car available: the Palio. It seems as if that might be the cheapest vehicle which Fiat would be interested in placing its name on, as reports are coming in which indicate that the company is considering a new brand for the further development of low-cost cars. Already, Fiat's competitor Renault has announced that it intends to continue operating in the cheap-car segment that it competes in already with the Logan. Bajaj is said to be working with Renault on its upcoming $2,500 Nano challenger.

So far, there has been no indication on whether the new brand will be a resurrection of a previous marque owned by Fiat or something completely different. Though the new low-cost vehicle would seem to be in direct competition with the Tata Nano, Fiat chief executive Sergio Marchionne indicates that the two brands, which already cooperate in other ways, might be working together on the project.

[Sources: Automotive News Europe - sub. req'd, Reuters]

Fiat is reportedly planning on introducing a natural gas-fueled version of its Palio compact in the Indian market in 2009. Compressed natural gas is a popular fuel in India, especially for buses. There are also experiments ongoing with using Hythane, a blend of 10 percent hydrogen gas along with the natural gas. The Palio hatchback is already available with both gas and diesel engines in India. Fiat is planning several vehicle introductions in the coming months in India including the tiny 500 and locally-produced versions of the Grande Punto and Linea. The 500s will be imported from the plant in Poland that produces them for the European market.

[Source: MyIris.com, thanks to Justin for the tip]

Brazilian electric utility Companhia Energetica de Minas Gerais (Cemig) is teaming up with Fiat to build a test fleet of battery-powered Fiat Palios. They will be building thirty of the cars powered by batteries from Swiss manufacturer KWO to start with at a price of $36,000. If the project works out a battery plant could be opened in Brazil near Fiat's plant in Minas Gerais state. In a country that has been an ethanol proponent for as long as Brazil it will be interesting to see how this project pans out.

[Source: Ward's Auto World]