Maruti Suzuki is yet to finalise the amount of the investment on the new plant and its location.
Maruti Suzuki will be getting a "big three-row strong hybrid model" from Toyota as part of collaboration
Photo Credit: Pixabay
Maruti Suzuki India (MSI) on Wednesday said it is looking to set up a manufacturing plant with a capacity of up to 10 lakh units per annum in order to cater to the expected increase in demand from domestic as well as export markets.
The company, which has earmarked a capex of around Rs. 8,000 crore for current fiscal year, is yet to finalise the amount of the investment on the new plant and its location.
The company said its board has given an in-principle approval for creation of up to 10 lakh vehicles per year capacity in the new plant, which is expected to come up in phases depending upon the market situation.
As of March 31, 2023, MSI has a cash reserve of around Rs. 45,000 crore. It had earmarked a capex of Rs. 6,300 crore in FY23.
The carmaker also announced that it will be getting a "big three-row strong hybrid model" from Toyota as part of their collaboration.
In a virtual press meet after the Q4 results, Maruti Suzuki Chairman RC Bhargava said the new facility would be in addition to its upcoming manufacturing plant in Sonipat in Haryana.
He noted that work on the new plant would be carried out simultaneously with the Sonipat plant.
MSI is investing Rs. 11,000 crore in the first phase of the Sonipat plant with an initial manufacturing capacity of 2.5 lakh units per annum, expected to be commissioned by 2025.
"We along with Suzuki looked at the estimated demand scenario over the next 8 years..it is expected that the Kharkhoda plant (in Sonipat) capacity will be fully utilised..so we decided to put up one million additional capacity," Bhargava said.
He noted that the company would take an internal accrual route to fund the new investment.
When asked about the expected investment on the new plant, Bhargava said it is yet to be finalised but hinted that it could be slightly higher that that on the Sonipat facility.
MSI's total existing production capacity is around 15 lakh units per annum in Manesar and Gurugram. It is also the sole beneficiary of 7.5 lakh unit capacity of Suzuki Motor Gujarat (SMG) under a contract manufacturing agreement.
Besides, it will be getting 10 lakh capacity from Sonipat plant.
On the company's electric vehicle programme, Bhargava said the company aims to have six fully electric models in its portfolio by 2030.
"The models would largely be in the SUV category," he noted.
Bhargava noted that in order to move towards carbon neutrality, the country requires a mix of different technologies and not rely on just one kind of technology.
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