Maruti Suzuki has finalized the site for new manufacturing facilities in Haryana; Per

The country’s largest carmaker Maruti Suzuki India (MSI) on Friday announced an investment of Rs 11,000 crore in the first phase of a new facility to be set up in Sonipat, Haryana.

The agency said it has completed the process of allocating an 800-acre site at IMT Kharkhoda in Sonipath district with HSIIDC (Haryana State Industrial and Infrastructure Development Corporation Limited).

The first phase of the new plant with an annual production capacity of 2.5 million units is expected to be commissioned by 2025, subject to administrative approval.

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

There will be room to expand the site’s capacity to include more manufacturing plants in the future, MSI noted.

In an interview with PTI, MSI Chairman RC Varghese said that Rs 11,000 crore would cover the cost of land, setting up of initial production lines and all other ancillary and ancillary infrastructure at the new plant.

“More investments will be made as we move forward,” Varghese said, without sharing any financial details.

He said the facility would help the company meet the demand going forward.

Asked if the new plant would replace the company’s Gurgaon-based facility, Varghese said: “This is a new facility that is coming and it will meet the growing demand from now till 2025 and even after that I don’t know what the demand will be. If it doesn’t grow and we don’t need any more power, we can shut down the Gurgaon plant. “

He noted that it was not possible to share long-term plans due to the uncertainty surrounding future market growth.

The company had earlier indicated that the new plant would replace the Gurgaon facility, which is facing serious traffic congestion.

Explaining the issue, Varghese said: “It was intended, but we have to see how the demand increases because this plant also came much later than originally planned … so the dynamics have changed.”

Regarding the current market situation, he said demand for entry-level vehicles was declining and there was a lack of clarity on how it would pan out in the future.

“The lower end of the car market is not growing, so what will be the effect. If it starts growing again, the market will be much bigger, if not, the demand will be completely different, so there is uncertainty as to why,” said Vargab.

Asked if the new plant could be used to produce electric vehicles, Varghese said: “It could be.”

At present, MSI has two manufacturing centers in Haryana and a Suzuki motor facility in Gujarat with a growing production capacity of about 22 lakh units per annum. Haryana’s two plants – Gurgaon and Manesar – together roll out about 15.5 lakh units a year.

Since the start of production of the third unit in April last year, its parent Suzuki Motor Corporation has set up a facility in Gujarat with an installed production capacity of 7.5 lakh units per annum.
All units manufactured at Suzuki Motor Gujarat Private Limited (SMG) are supplied to MSI.

Auto Major has been working for more than two years to shift production from the Gurgaon plant which is now surrounded by residential areas.

The plant, the company’s first in the country, where the firm launched in India in 1983 with its first model – the iconic Maruti 800.

With the rapid development of Gurgaon, the company found its plant in the middle of a busy city which made it difficult for trucks carrying raw materials and finished goods to get in and out of the facility.

Last year, Varghese said the company had allocated about Rs 18,000 crore for the new facility.

The new plant will replace the company’s Gurugram-based facility and is expected to have an installed production capacity of 7.5 lakh to 10 lakh units per year, he said.

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