Maruti Suzuki to invest Rs 11,000 crore in Haryana facility

Existing plants at Gurugram and Manesar have capacity of 15,80,000 units, while Gujarat plant can manufacture 5 lakh units per annum

Published: 14th May 2022 07:23 AM  |   Last Updated: 14th May 2022 07:23 AM   |  A+A-

Maruti Suzuki India (File Photo | Twitter)

Maruti Suzuki India (File Photo | Twitter)

By Express News Service

NEW DELHI:  The country’s largest carmaker Maruti Suzuki (MSIL) is investing Rs 11,000 crore in the first phase to set up a new manufacturing facility in Haryana.  The carmaker on Friday said that it has completed the process of allotment of an 800 acres site in Sonipat. 

The new facility, which will have a capacity of 250,000 vehicles per annum, is expected to be commissioned by 2025, subject to government approvals. Currently, MSIL’s two existing plants at Gurugram and Manesar in the state have a combined capacity of 15,80,000 units, while the plant in Gujarat has 5,00,000 units capacity per annum. Together, the facilities churn nearly 1,73,000 units a month. 

The fresh investment comes at a time when its lions share in the Indian passenger vehicle (PV) market has seen a steady fall over the past two years. While during the pre-covid years it used to sell one in over two PVs sold in India,  its market share stood at 43.65% in FY2022, its lowest in 8 years.  The fall in sales is attributed to the growing preference for SUVs and smaller hatchbacks becoming expensive for its target audience. Further, a global shortage of semiconductors has severely impacted production at MSIL, with the carmaker in its Q4FY22 results saying that it had a pending order of 2,68,000 units by the end of March 2022. 

This investment announcement comes months after its parent company - Japan’s Suzuki Motor (SMC) -  had signed a memorandum of understanding (MOU) with the Gujarat government to invest 150bn yen (Rs 10,440 cr) for local manufacturing of electric vehicles (EV) and EV batteries, a space where Maruti Suzuki’s competitors have taken an edge. 

Under the MoU, Suzuki Motor’s wholly-owned Suzuki Motor Gujarat (SMG) will invest Rs 7,300 crore for the construction of a battery plant near SMG’s automobile unit by 2026. SMG will invest another Rs 3,100 cr for ramping up capacity for EVs by 2025. In recent times, a number of carmakers like Toyota and MG Motor have announced big investments in India. This has helped the government to counter the sharp criticism it has been facing after half a dozen automakers shut their operations in India during the past six years or so. 

Tesla holds its India Plans
Elon Musk’s Tesla has put on hold plans to sell electric cars in India, according to media reports. It has abandoned a search for showroom space after its year-long demand for low import taxes was not heard by the Indian authorities Earlier, Union minister Nitin Gadkari had said Tesla is welcome to set up its facility in India. However, Gadkari said he was against Tesla’s strategy to import its vehicles from China. 

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