Renault believes its bold bid to market a €5,000 medium-sized car that meets all basic western European standards is certain to succeed, according to Automotive News Europe (ANE).

The motor industry was highly sceptical in 2000 when Renault chairman Louis Schweitzer launched the X-90 project to develop a robust and very inexpensive family car for developing countries.

It wasn't the car but the goal to price the car at €5,000 that others doubted. That price was about a quarter of the price for similar-sized three-box saloons meeting western European standards. And it was €3,000 cheaper than entry-level cars sold in western Europe, such as the Fiat Panda or Citroen Saxo.

It appeared at times as if Schweitzer himself doubted his ambition was realistic. Early last year, he called the €5,000 price target a "stretched objective," an over-ambitious goal meant to galvanise energies, but not necessarily to be met.

"Today, we have all the elements of the equation," Pierre-Alain de Smedt, executive vice-president in charge of manufacturing, said in an interview. "We can manufacture this car for a little over €3,000."

Because manufacturing costs are so low, Renault can sell the car for €5,000, de Smedt said. Manufacturing costs do not include marketing and dealer-margin expenses.