Maruti Suzuki India Chairman RC Bhargava on Wednesday said the company is in discussion with the Gujarat government to get the appropriate land parcel for its second plant to be set up at an investment of Rs 35,000 crore.
The country’s largest automaker plans to produce 10 lakh of games annually at the new plant, aiming to increase its annual production capacity to more than 40 lakh of games until 2030-31. In an interaction with PTI, Bhargava said the automotive primary had signed a memorandum of agreement (MoU) with the Gujarat government to expand its business in the state. “It’s like the maximum of those memorandums of understanding that are non-binding and subject to board approval. So far, the company’s board of directors has nothing to do with it. Bhargava said.
While noting that Gujarat is the preferred state for the new plant, he said the right set of land parcels is needed to set up the new facility.
“We, together with the suppliers, will make an investment of Rs 35 billion depending on the availability of suitable land, as so far we have not been able to locate and acquire the land needed for expansion,” Bhargava said.
”You can’t expand without getting the land. So, that is the situation right now,” he added.
When asked if there was any disruption in getting the required land parcel in the state, Bhargava said, “Getting land anywhere for anything is an undeniable exercise. “
”So, for now the search for land goes on.” The company is having discussions with the Gujarat government, but no plot of land has yet been finalised, Bhargava stated.
When asked if it would be feasible to reach the target of starting production at the beginning of the 2028-29 monetary year, he said: “It is feasible. There’s still plenty of time for that. ” Bhargava noted that the reason Gujarat is the preferred state to have the new plant is because the automaker already has an established supplier base in the state.
“But the current production volume is only 7. 5 lakh units. To achieve the most productive economies of scale, it is desirable that those other people (suppliers) have the ability to expand production in the existing (state) and increase up to 20 lakh units,” he added.
In addition, the company has set a target of exporting 7. 5 to 8 lakh of sets by 2030-31, and being close to Gujarat’s ports, the automaker enjoys some merit in terms of shipping cost savings, he noted.
“That’s why Gujarat is the state, but then you have to get the right kind of land for that,” the veteran industry leader said.
Bhargava noted that both the company and state government are aware of the importance of the time.
“And both sides will do everything they can to close this case as temporarily as possible,” he added.
Bhargava called Gujarat an ideal investment destination, noting that if the state was not smart in terms of policies and business environment, the company would not have undertaken such expansion there until now. When asked if the domestic car market would grow to an extent commensurate with the expansion of production undertaken through the company, he replied in the affirmative.
“Definitely, all indications are that the economy will grow. Everything is moving in the direction of growth,” Bhargava said.
There can be unforeseen events, but the government has been taking a lot of steps to improve the ease of doing business, he added.
Speaking at the Vibrant Gujarat Global Summit (VGGS) in Gandhinagar, Suzuki Motor Corporation Chairman Toshihiro Suzuki announced earlier in the day that MSI will invest Rs 35 billion to set up a new plant in Gujarat.
As a result, Gujarat’s annual production capacity will be 2 million (20 lakh) sets: 10 lakh at Suzuki Motor Gujarat and 10 lakh at the new plant, Suzuki said. Suzuki Motor Corporation owns approximately 58 percent of MSI’s constant production. with percentage capital.
Currently, MSI has a cumulative output of around 22 lakh games per year at its two production plants in Haryana and Gujarat.
The two factories in Haryana, Gurugram and Manesar, together deploy around 15. 5 lakh of equipment per year.
Suzuki Motor Gujarat, a unit of the company, has also established a factory in Gujarat with a production capacity of 7. 5 lakh per year.
In addition, the automotive market leader is already in the process of building a new production plant at Sonipat in Haryana with an investment of Rs 11 billion in the first phase.
The first of the new plant, with a production capacity of 2. 5 lakh per year, is expected to be operational within the next year.
(This story has not been edited through Devdiscourse and is automatically generated from a syndicated feed. )