Indian Economy News

According to Mr. RC Bhargava, Chairman, Maruti Suzuki, the company intends to invest Rs. 45,000 crore (US$ 5.43 billion) to double annual capacity to 40 lakh units in eight years

  • IBEF
  • August 30, 2023

According to Mr. RC Bhargava, Chairman, Maruti Suzuki, in the next eight years, Maruti Suzuki India plans to invest almost Rs. 45,000 crore (US$ 5.43 billion) to quadruple its production capacity to 40 lakh cars yearly. The company will also take up suggestions by shareholders for a stock split to its board for consideration.

Since it is difficult to predict what will happen in the next eight to ten years in terms of new technologies, he said Maruti Suzuki will also deal with a lot of technologies, including electric vehicles (EVs), hybrids, CNG, ethanol-blended, and use of compressed biogas going forward.

He further mentioned that the company has reached two million in production and sales in 40 years and now preparing to add two million in the next eight years while the focus is also to double the turnover of the company in its third phase of the journey.

The time ahead will be extremely tough and uncertain. It will cost close to Rs. 45,000 crore (US$ 5.43 billion) just to put up these 2 million autos. Depending on how inflation plays out, it is currently projected that 2 million cars will cost roughly around the same amount.

Under 'Maruti 3.0' the company is targeting to add another 20 lakh units of production capacity with about 28 different models in the market by FY31.

Mr. RC Bhargava stated to the shareholders in the company’s annual report that the first phase of the company was when it was a public enterprise. The second phase ended with the COVID pandemic, and the Indian car market became the third largest in the world. He also reiterated the need for a structural reorganisation of the company in view of its future growth prospects.

He added that the production of six models between 2024-25 and 2030-31 will give the company a very good position in the market and that the company management, all of its employees, engineers, and Suzuki Japan "have all carefully assessed the total environment for electric vehicles in India. He also stated that the company will regain its market share going forward with efforts of company to strengthen its presence in the fast-growing SUV segment after witnessing a dip due to the decline in demand for small cars.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.