India's largest car manufacturer, Maruti Suzuki India Limited, is making a massive investment in Gujarat. The company plans to spend Rs 4,960 crore on expanding its production capacity in the state.
New Manufacturing Plant in Sanand
Maruti Suzuki's board approved this significant investment on Monday. The company will acquire land at Khoraj Industrial Estate in Sanand from the Gujarat Industrial Development Corporation. This land will host the company's second passenger vehicle manufacturing plant in Gujarat.
The new facility promises to add substantial production capacity. It will manufacture 10 lakh passenger vehicles annually once fully operational.
Expanding Existing Operations
Maruti Suzuki already operates a manufacturing plant at Hansalpur in Gujarat. This facility currently produces 7.5 lakh units each year. The company recently announced plans to add a fourth production line at Hansalpur during the Vibrant Gujarat Global Summit 2024.
This fourth line specifically addresses the expected growth in electric vehicle production. It should begin operations between 2026 and 2027. Once complete, the Hansalpur plant's annual capacity will increase from 7.5 lakh units to 10 lakh units.
Current Production Capacity
Maruti Suzuki operates manufacturing facilities across multiple locations. These include plants in Gurugram, Manesar, Kharkhoda, and Hansalpur. Together, they provide an installed capacity of approximately 24 lakh vehicles per year. The company can achieve peak production of about 26 lakh units annually.
Company officials stated that this existing capacity is now fully utilized. This situation creates the need for fresh investments in new production lines to meet growing demand.
Investment Details and Timeline
The board has approved an initial outlay of Rs 4,960 crore. This funding will cover land acquisition, development work, and preparatory activities for the new Khoraj facility. The site is located approximately 30 kilometers from Ahmedabad.
Maruti Suzuki will finalize the exact timeline for commissioning the additional capacity in phases. The total project cost will also be determined gradually as the project progresses.
The company confirmed that this investment will come from multiple sources. "The investment will be funded through a combination of internal accruals and external borrowings," Maruti Suzuki stated in a regulatory filing.
Strategic Importance of Gujarat
This expansion reinforces Maruti Suzuki's long-term strategy for Gujarat. The company views the state as a crucial manufacturing and export hub. The Hansalpur facility previously operated as Suzuki Motor Gujarat before merging with Maruti Suzuki.
This plant already plays a vital role in supplying vehicles to international markets. The new investment further strengthens Gujarat's position in Maruti Suzuki's global operations.
