Suzuki Motor, Maruti Suzuki India (MSIL), and Suzuki Motor Gujarat (SMG) have approved the transformation of SMG into a subsidiary of MSIL.

This decision was made during a board meeting on 31 July 31, 2023.

SMG, a wholly owned subsidiary of Suzuki, has been operating under a contract manufacturing agreement with MSIL since 2017, supplying all vehicles to the latter.

As part of the agreement, MSIL holds the right to acquire all the shares of SMG in the event of contract termination.

The process is pending the approval of shareholders of MSIL and the Indian government, as required by regulations, which was expected to be completed by the end of this financial year (31 March 2024).

The new structure aims to boost production efficiency and integration in India.

The company has also announced plans to construct new plants with capacity for 1m units in Kharkhoda, Haryana, scheduled to start operations in 2025.

MSIL plans to have capacity for 4m units in India by fiscal 2030.