Ghosn said he was thinking about the next generation of Logan and another car costing around $3,000. Ghosn was referring to a small car that Renault proposes to develop with Bajaj in India.

"We have had contacts with Bajaj and that was about the $3,000 car, but we are still in a phase of making up our minds," a Renault spokeswoman said.

Logan, designed for emerging markets and originally assembled in Romania at Renault''s Dacia subsidiary, has become a big hit in the mature European market as well. Renault is currently ramping up capacity in North Africa, Latin America, India and Russia.

In Russia Renault is in contact with Lada maker AvtoVaz for Logan production although a decision is yet to be made.

Logan was adding to group profits and would reach a 5 to 6 per cent margin in 2009, said Renault finance director Thierry Moulonguet, adding that its success has prompted other car makers such as Toyota Motor Corp, Honda Motor Co, Fiat SpA and Volkswagen AG to launch cheap models.

Logan has three versions, including a saloon and van. Renault sold 159,000 units in the first half of 2007, up 28.6 per cent from the same period of the previous year.

Renault-Nissan is working with Mahindra & Mahindra to build Logan in India. The two also plan to partner an Indian vehicle maker to develop a $3,000 car, Ghosn said.

Renault opened a design centre in India last week and Ghosn sees India as the natural place to develop a low-cost car.