Maruti Suzuki board approves land purchase for new facility in Mehsana.
Vikram Samvat 2068 has begun on a good note for Gujarat. Two days into the Gujarati New Year, and Maruti Suzuki India Limited, the country’s largest car manufacturer, announced that it is setting up its next car manufacturing plant in Gujarat.
Maruti Suzuki, which commands more than 50% market share in the country, said on Saturday that its board has approved land purchase for the new facility in Gujarat. The company could invest up to Rs18,000 crore in the state.
Maruti Suzuki is the third automobile manufacturer in as many months to announce car manufacturing plants in the state after Ford India and PSA Peugeot. Maruti Suzuki’s decision to drive into Gujarat would give a major boost to the state’s ambitions to emerge as India’s Detroit. DNA was the first to report on May 18, 2011, that Maruti Suzuki India Limited is scouting for land in Gujarat for setting up a car manufacturing plant.
Following its board meeting on Saturday morning, Maruti Suzuki said in a release that the board had granted approval to purchase land in Mehsana district for future expansion of manufacturing facilities.
Maruti Suzuki, 54.2% owned by Japan’s Suzuki Motor Corporation, did not specify the exact location in Mehsana, but state government sources said that the company has finalised a location near Bechraji, around 110 km from Ahmedabad, for the plant.
"The proposed plant in Mehsana would help boost exports due to the location's proximity to a port," Maruti Suzuki chairman RC Bhargava told a news channel after announcing the company's second quarter results.
Maruti Suzuki plans to invest up to Rs18,000 crore for future expansion. It would invest Rs6,000 crore for a plant having capacity to produce 10 lakh cars per annum, and a similar amount in the second phase for another plant of similar capacity. In also plans to build a vendor park and supporting infrastructure with an investment of a further Rs6,000 crore. Discussions have been going on between the state government and Maruti officials for the past few months over the modalities of setting up the plant in the state. Suzuki Motor Corporation chairman Osamu Suzuki and Maruti Suzuki chairman RC Bhargava had met Chief Minister Narendra Modi and evinced interest in investing in Gujarat.
The company requires around 500 - 600 acre land for the plant, and a further 500 acre for vendors. Sources said that state government has earmarked 500 acre land near Bechraji for the project. "With the Maruti Suzuki board giving the formal approval, the formalities for transferring the land to the company are likely to be completed soon," said a senior official of industries department.
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