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Maruti looking at Gujarat to set up new plant
The country's largest car maker Maruti Suzuki India is understood to be scouting for location to set up a manufacturing unit in Gujarat, which could be its first plant outside Haryana where it has been based since its inception in 1983.
According to official sources in Gujarat, senior MSI executives met the state government representatives during the first week of May in the state capital.
"So far three rounds of talks have taken place between the two parties. We have offered them land at three different locations in the state," a senior government official said.
The state government has offered the MSI executives options at Sanand, Halol and Dholera localities, he added.
"The company has not yet finalised any location," the source said.
When contacted, a MSI spokesperson declined to comment. Industry sources, however, said the company is at a very early exploratory stage for a possible plant at Gujarat.
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Maruti looking at Gujarat to set up new plant
Meanwhile, the Haryana government has said it is unaware of any possible moves by the company to invest outside of the state for future expansion.
"It (Maruti investing in Gujarat) is not in my knowledge and the business plan of the company is decided by the company (itself) and I cannot comment on that," Haryana Industries Minister Randeep Singh Surjewala told PTI.
MSI's manufacturing has so far been concentrated in Haryana with two production facilities in Gurgaon and Manesar, besides an upcoming research centre in Rohtak.
Last month, MSI chairman R C Bhargava had said the company may have to look for new manufacturing plant if it ran out of capacities while trying to meet its aim of selling up to 30 lakh (3 million) units every year by 2015-16 from 12.71 lakh (1.271 million) units in last fiscal.
"If we run out of capacities, then we will have to look for something else. But it all depends on how the existing and upcoming capacities will be utilised, which will go on till 2013," Bhargava had said.
He had further said that any decision to set up a new unit will be taken in consultation with parent Suzuki Motor Corp.
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Maruti looking at Gujarat to set up new plant
Earlier, sources had said that the firm has already started internal discussions to set up its 7th plant and a final decision to this effect is likely to be taken within the next one year.
The new plant could be either at the Manesar facility or elsewhere depending on the infrastructure to avoid any congestion.
If MSI decides that Manesar cannot handle too much of load after the two upcoming plants go on stream, then it will look for a new location for the new plant, the source had added.
At present MSI, which is 54.2 per cent owned by Suzuki Motor Corp, is setting up two new units with an annual installed capacity of 2.5 lakh (250,000) units each inside its Manesar facility at a total investment of Rs 3,625 crore (Rs 36.25 billion).
While the existing plant in Manesar can produce 3.5 lakh (350,000) units annually, its three units in Gurgaon have a combined annual capacity of 8.5 lakh (850,000) units.
MSI's present overall capacity is 12 lakh (1.2 million) units per year.
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Maruti looking at Gujarat to set up new plant
Once the new units in Manesar become operational by 2012-13, the company's total production capacity will go up to 17 lakh (1.7 million) units annually.
Besides fresh investment at Manesar, MSI is investing Rs 2,500 crore (Rs 25 billion) for its K-series engine plant and setting up a dedicated R&D facility both at Rohtak.
In 2010-11, the company's sales soared 24.81 per cent to 12,71,005 units from 10,18,365 units in the previous fiscal.
Domestic sales increased by 30.08 per cent to 11,32,739 units from 8,70,790 units in the previous fiscal.
MSI's passenger car sales during last fiscal jumped by 26.24 per cent at 9,66,447 units from 7,65,533 units in FY'10. However, its market share in this segment fell to 48.74 per cent from 50.09 per cent in 2009-10.