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March 24, 2010

INDIA: Maruti Suzuki hits 1m a year milestone

Maruti Suzuki India has joined a select club of global automakers, becoming the first Indian company to produce 1m cars a year.

Maruti Suzuki India has joined a select club of global automakers, becoming the first Indian company to produce 1m cars a year.

The millionth car manufactured in fiscal year 2009-10, a red Suzuki Swift, on Tuesday rolled off the Manesar assembly line at a ceremony attended by government and local officials, the Japanese ambassador and Suzuki Motor Corporation chairman and CEO Osamu Suzuki.

Maruti also laid the foundation stone to expand output at Manesar plant by 250,000 units a year, taking capacity to 550,000 units over the next two years.

Maruti Suzuki will spend about INR17bn ($US373.4m; EUR276.3m) on the expansion.

“All world-class manufacturers are entering India and we are facing severe competition here,” the Suzuki chairman told reporters after the ceremony.

“We achieved 1m units but to achieve production of 2m… will be a tough journey,” the Suzuki Motor chairman said.

Last year, Maruti’s sales outstripped parent Suzuki Motor’s performance in Japan. “Cumulatively, we have produced over 8.8m cars in India,” Suzuki noted as the milestone Swift left the line.

Half of the investment will be spent on expanding engine production and the other half on setting up a research and development facility.

The automaker, which builds and sells a wide variety of Suzuki-designed cars from the tiny, late 1970s-designed Maruti 800 entry level hatchback to the top selling Swift, exports many and builds a version of its A-star/Alto on an OEM basis as the Nissan Pixo, has production facilities in Gurgaon (700,000 units) and Manesar (300,000) units.

Maruti Suzuki chairman, RC Bhargava, said: “The landmark attained by Maruti Suzuki fully establishes the validity of the late prime minister Indira Gandhi’s vision when she decided to create Maruti Udyog. This vision has been fulfilled because of outstanding entrepreneurship of O Suzuki, the excellent cooperation which existed between the government of India and Suzuki Motor Corporation, and the enormous dedication, hardwork and commitment of all Marut Suzuki employees over the last more than 26 years. The future beckons and Maruti Suzuki will not be found wanting.”

Dedicating the one millionth car to Maruti Suzuki employees, Maruti Suzuki CEO and managing director Shinzo Nakanishi said: “Maruti Suzuki will continue to address the country’s need for affordable personal transport. India needs affordable commuting solutions.”

Maruti Suzuki began in India building the 800 hatchback and it quickly became a best seller.

In the first full financial year of commercial operations, production reached a little over 22,000 cars but in the past few years output has soared.

India is now Asia’s third largest car market, behind only by China and Japan, and is one of the few countries where automobile sales are rapidly increasing. Car sales overall jumped 19% last year to 1.43m units.

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