Toyota has been working on an affordable small car that will be cost-competitive in emerging markets, and Autocar is reporting that India is being considered as a destination for production. India makes sense due to its low-cost labor, and with competitors like the Tata Nano going for as little as $2,500, the world’s biggest automaker will need to cut cost everywhere it can. There is no word as to exactly what vehicle would be produced in India, but one option is Toyota’s production iQ from Geneva, which is scheduled to begin production later in 2008. Toyota is looking for initial sales of the iQ to crest 100,000 units.

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Ford has issued a press release confirming that it has sold both Jaguar and Land Rover to Tata Motors for an approximate price of $2.3 billion, which comes under some numbers as high as $2.65 billion that were being tossed around yesterday. The rumor that Ford will contribute to pension funds associated with the brands is also true, as it confirmed that $600 million will be dropped into the retirement coffers of the brands once the deal closes. It is, of course, subject to regulatory approval in a number of countries, but the automaker expects the deal to be done by the end of the following quarter. As part of the deal, Ford will continue to supply powertrains, stampings and other unnamed vehicle components to Tata for “differing periods”, as well as R&D research, environmental and platform technologies, and even accounting services, among others. Clearly the ties that bind Jaguar Land Rover to Ford are strong and will take some time to undo. Judging from the press release, it seems all parties involved, including the employees of Jaguar Land Rover, are pleased with how the deal went down, and for the time being both brands will be run business as usual during the transition period.

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