Maruti Suzuki plans $3.9 billion investment in Gujarat auto plant

Indian automaker Maruti Suzuki will invest 350 billion rupees ($3.9 billion) in a new manufacturing plant it plans to set up in the western Indian state of Gujarat, the state government said on Saturday.

The proposed plant will add production capacity of up to one million vehicles a year as the company expands manufacturing to meet rising demand in India, the world’s third-largest car market, and for exports, the Gujarat government said in a statement.

Production at the new facility is expected to begin in the financial year 2029. The additional capacity will add to Maruti Suzuki’s existing annual production capacity of 2.4 million vehicles. The company is majority-owned by Japan’s Suzuki Motor and is India’s largest carmaker by sales.

Maruti Suzuki currently has an order backlog of about one and a half months for its entry-level models, the company’s marketing and sales head Partho Banerjee said earlier this month. The company also said its sales to domestic dealers rose 37 per cent in December to a record 178,646 units.

Earlier this week, Maruti Suzuki’s board of directors approved an initial investment of 49.6 billion rupees to acquire land for the proposed plant.

(With inputs from Reuters)