Suzuki is planning to invest Yen 100 billion, or Rs 5,679 crore, for the expansion of its Gujarat manufacturing plant.
The investment will go into addition of a new production line at the facility in Hansalpur, Gujarat. The plant, which became operational earlier this year, was commissioned in 2015 with an investment of Rs 3,041 crore. It currently has an annual production capacity of 2.5 lakh units, but this number should go up to 4.5 lakh units with the addition of the new production line. This will raise Maruti Suzuki’s annual capacity to 22.5 lakh units. The facility in Hansalpur is wholly-owned by Suzuki and the cars manufactured at the facility are sold to Maruti Suzuki India Ltd., which is then sold to customers in India.
Maruti Suzuki sold 15.68 lakh cars in the last financial year, which accounts for 53 per cent of Suzuki’s global sales. Despite recording a 9.8 per cent growth, the company is being held back by capacity constraints. With the expansion of the Gujarat plant, Maruti Suzuki will finally be on track for registering a double digit growth.