Maruti Suzuki designs Rs 11,000 cr for new factory in Haryana

Maruti Suzuki designs Rs 11,000 cr for new factory in Haryana

The new plant’s first phase with a manufacturing capacity of 2.5 lakh units per annum is expected to be commissioned by 2025, subject to administrative approvals.

Maruti Suzuki’s new plant in Haryana has been concluded, as the country’s biggest carmaker has made a declaration. The new plant will see the organization put over Rs 11,000 crore in the first phase. The carmaker had in conversation with Haryana government for investment in a new manufacturing site for its proposed limit expansion. The process of allotment of an 800 acres site at IMT Kharkhoda in District Sonipat with HSIIDC (Haryana State Industrial and Infrastructure Development Corporation Limited) was completed.

In the first phase, the investment would be over Rs 11,000 crore, it added.

The site will have space for capacity expansion to include more manufacturing plants in the future, MSI noted.

In an interaction with PTI, MSI Chairman R C Bhargava said the Rs 11,000 crore would cover the cost of land, setting up of the initial production lines and all other ancillary and supporting infrastructure at the new plant.

“There will be further investments as we go along,” Bhargava noted, without sharing any financial details.

He said the facility would help the company cater to the increase in demand going ahead.

Asked if the new plant would replace the company’s Gurgaon-based facility, Bhargava said: “This is a new facility which is coming up and it will cater to the increasing demand between now and 2025 and beyond that I don’t know how the demand will be… We can only shut the Gurgaon plant if demand doesn’t grow and we don’t need any more capacity.”

He noted that sharing long-term plans is not feasible because of the uncertainties related with market growth in the future. The company had earlier hinted that the new plant would end up replacing the Gurgaon facility, which is facing severe congestion issues.

Clarifying on the matter, Bhargava said: “That was the intention but we will have to see how the demand grows because this plant has also come much later than what was originally planned… so the dynamics have changed.” On the current market situation, he said demand for entry-level cars was going down and there was lack of clarity as to how it will pan out in the future.
“The lower end of the car market is not growing, so what impact would it have..if it starts growing again, then the market will become much bigger, if it doesn’t, then the demand would be quite different, so that’s why there is uncertainty,” Bhargava said.

Asked if the new plant could be utilised for electric vehicle production, Bhargava said: “It can be.” At present, MSI has a cumulative production capacity of around 22 lakh units per annum across its two manufacturing plants in Haryana and parent Suzuki Motor’s facility at Gujarat. The two plants in Haryana — Gurgaon and Manesar — together roll out around 15.5 lakh units per annum.

Its parent Suzuki Motor Corp has also set up a facility in Gujarat with an installed production capacity of 7.5 lakh units per year after the third unit started production in April last year. All units produced at Suzuki Motor Gujarat Pvt Ltd (SMG) are supplied to MSI.

The auto major has been working for more than two years to move manufacturing from the Gurgaon plant which is now surrounded by residential areas. The plant, the company’s first in the country, is where the firm began its India journey in 1983 by rolling out its first model — the iconic Maruti 800.

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