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April 18, 2017

Maruti Suzuki eyes 1.7m capacity this fiscal year

Indian market leader Maruti Suzuki will have a combined production capacity of around 1.7m units this financial year (to 31 March, 2018) as it heads towards the 2020 target of 2m.

Indian market leader Maruti Suzuki will have a combined production capacity of around 1.7m units this financial year (to 31 March, 2018) as it heads towards the 2020 target of 2m.

The additional capacity will not only reduce the waiting lists for the Ignis, Baleno and Vitara Brezza, but will also cater to the launches and upgrades lined up for the year, ET Auto reported.

Kenichi Ayukawa, MD & CEO, Maruti Suzuki said: "The Suzuki Motor Gujarat (SMG) Hansalpur facility brings some respite to us. The first line with total installed capacity of [250,000] units per annum went on stream early February and will ramp up gradually. The Baleno is being manufactured there and this will bring down the waiting period on the Baleno."

"The total capacity available to Maruti Suzuki India (MSIL) in FY 17-18 therefore is [1.55m] units at Gurgaon and Manesar plus another [150,000] units at SMG, totalling it to… 1.7m units per annum," he added.

While the first assembly line at the Gujarat plant will ramp up partially this financial year, work on the second has also begun and the company may even go in for a third, the ET Auto report said. The campus is capable of ultimately going up to 750,000 units a year in combined capacity. The master plan of the Hansalpur campus includes three lines of 250,000 units each.

"The second assembly line at Gujarat plant (another [250,000] capacity) and engine and transmission plants has been announced by SMC at an investment of around US$900m," said Ayukawa.

"Work on this second plant in Hansalpur has commenced. Besides, the Hansalpur campus can also take a third assembly plant, in future, in line with market demand," he added.

ET Auto said the frenetic capacity building is backed by some aggressive volume targets. MSIL sees itself clocking double digit growth in the current financial year.

"Maruti Suzuki is embarked on a mid-term goal of 2m vehicles sales in 2020 and is working towards it on all fronts. Going by current estimates where the industry is projected to grow by 7-9 % in FY17-18, and we are determined to do better than industry," said Ayukawa.

The capacity ramp up will further ease the waiting lists on the Ignis, Baleno and Vitara as well as take care of new models, ET Auto said. "We are committed to bringing in 15 new models over the five years to 2020. In FY 17-18 we will bring two new models and two upgrades," said Ayukawa.

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