Suzuki Motor will invest a further 200bn yen ($US1.66bn) in its Indian venture as it expands capacity at car and engine plants, its chairman was quoted as saying on Tuesday.


Already, 100bn yen has been spent on plants run by Maruti Udyog, and another 200bn yen will be spent by 2010, taking total capacity to 1m cars a year from 630,000 now, Osamu Suzuki told the Reuters news agency.


Maruti, majority owned by Suzuki, on Tuesday opened its fourth car plant in Haryana state near New Delhi with planned initial annual capacity of 100,000 units that will be expanded to 300,000 units by 2010, the report said.


“Suzuki made a commitment to India at a time when it was not fashionable to invest in India,” Maruti Udyog managing director Jagdish Khattar told Reuters, adding: “This (new plant) marks the most important milestone in our partnership.”


Maruti had earlier said total investment in new plants and new cars would top 90bn rupees ($2.04bn) by 2010, the report added.


Maruti will make its popular Swift hatchback at the new plant, which can roll out a car every 50 seconds, Reuters said.


A new export model, scheduled to be launched in 2008/09, will also be made at the plant, located in a 600-acre campus that will also house vendors and a research and development facility. A diesel engine and transmission plant, which was also inaugurated on Tuesday at the same location, will start with an output of 100,000 units and reach 300,000 over the same period, the report added.


“We have entered the diesel segment with a very competitively-priced product,” Khattar told Reuters. “We think it will help us a great deal.”


Reuters said JD Power estimates diesel’s share of India’s passenger vehicle market will grow to 35% by 2010 from 30%.


The report said Maruti, which will also upgrade its existing plants in Haryana state’s Gurgaon town, plans to export 200,000 cars a year by 2010 to Europe and other markets. It also hopes to export diesel engines to Suzuki units worldwide, starting with Hungary.


Maruti will also make a new model for European markets from 2009/09, and 50,000 compact cars a year for Nissan, Reuters added.