Maruti Suzuki India plans to double its production capacity to four million units in nine years, said Chairman R C Bhargava, hinting that the automaker may reorganise its structure to achieve the ambitious plan termed “Maruti 3.0”.
Addressing shareholders in the company’s annual report for 2022-23, Bhargava stated that he expects the company to grow at over 6 per cent during FY24. He also projected a 6 per cent growth rate for the country’s car industry until FY31.
“Our first phase was when we were a public enterprise. The second phase ended with the Covid pandemic, and the Indian car market became the third largest in the world,” he said, adding that it took 40 years to create a capacity of two million units.
“Your company now has to add the next two million in a period of nine years. The task of managing all the issues relating to the production of four million units a year requires considerable thought and possible reorganisation of the structure of the company… We will, as soon as possible, announce what we are proposing.”
He highlighted that in FY23, the company’s exports reached 2.59 lakh units, and it anticipated a continued growth in demand for exports. As a result, the company projects export volumes to reach 750,000-800,000 cars by FY31.
Due to increasing domestic and export requirements, Maruti Suzuki India has recognised the need to expand its manufacturing capacity, he said.
Outlining the expansion plan, Bhargava said that the company is working on the first site in Kharkhoda, Haryana, where a plant with a capacity of 2.50 lakh units is expected to commence production in the first half of 2025.
Subsequently, Maruti Suzuki plans to add a similar plant each year to achieve a total capacity of one million units. Additionally, the company is in the process of selecting a second site to add another one million capacity by FY31.
Bhargava also said that by FY31, the automaker could have about 28 different models. “Clearly the organisation and systems for selling such a large variety of cars will require changes from what exists at present,” he said.
Further, he said that the development of electric vehicles is “proceeding well”at the Gujarat facility. “Your company expects to start the sale of the first model in 2024-25. By 2030-31 we expect to have 6 EV models. These models are expected to comprise 15-20% of our total sales by that time.”