In a major boost to Gujarat's industrial landscape, India's leading car manufacturer, Maruti Suzuki India Limited, has unveiled plans for a significant capacity expansion in the state. The company's board has greenlit a substantial investment of Rs 4,960 crore to set up a second passenger vehicle manufacturing facility near Ahmedabad.
Land Acquisition and Initial Outlay Approved
The board, in a meeting held on Monday, approved the acquisition of land at the Khoraj Industrial Estate from the Gujarat Industrial Development Corporation (GIDC). The approved investment of nearly five thousand crore rupees will be directed towards land acquisition, development, and preparatory activities for the upcoming plant. The company clarified that the exact total project cost and the timeline for commissioning will be finalized in subsequent phases.
This fresh capital infusion will be financed through a mix of internal accruals and external borrowings, as stated in the company's regulatory filing. The move comes at a crucial time as Maruti Suzuki's existing manufacturing network is operating at full tilt.
Addressing Full Capacity and Future Demand
Maruti Suzuki currently operates plants in Gurugram, Manesar, Kharkhoda, and Hansalpur (Gujarat). The combined installed capacity across these facilities stands at approximately 24 lakh vehicles per annum, with a peak capability of 26 lakh units. The company has confirmed that this existing capacity is now fully utilized, creating an urgent need for new investments to meet growing domestic and export demand.
The new facility at Khoraj is slated to add a colossal 10 lakh units (1 million) of passenger vehicle production capacity to the company's portfolio. This expansion will significantly bolster Maruti Suzuki's presence in Gujarat, where it already operates a major plant in Hansalpur.
Gujarat: The Strategic Manufacturing and Export Hub
This investment reinforces Maruti Suzuki's long-standing strategy of leveraging Gujarat as a pivotal manufacturing and export hub. The Hansalpur plant, which was originally Suzuki Motor Gujarat before its merger with Maruti Suzuki, already plays a critical role in supplying vehicles to international markets.
The commitment to Gujarat was further highlighted during the Vibrant Gujarat Global Summit 2024, where the automaker announced plans for a fourth production line at the Hansalpur plant. This line, focused on future electric vehicle production, is expected to commence operations from the financial year 2026–27. Once operational, it will increase the Hansalpur plant's annual capacity from the current 7.5 lakh units to 10 lakh units.
The dual expansion in Gujarat—through the new Khoraj plant and the additional line at Hansalpur—signals a robust growth trajectory for Maruti Suzuki. It underscores the company's confidence in future market demand and its commitment to strengthening India's position in the global automotive sector, with Gujarat firmly at the center of its operations.
