New Delhi: Maruti Suzuki India Ltd (MSIL) has taken a decisive step to expand its manufacturing footprint, with the company’s board approving the acquisition of land at the Khoraj Industrial Estate in Gujarat for capacity expansion, according to a regulatory filing on Sunday.
The proposed expansion could add up to 1 million vehicles a year to Maruti Suzuki’s production capacity, underscoring the country’s largest carmaker’s bullish outlook on market growth, including exports. The company currently operates manufacturing facilities across Gurugram, Manesar, Kharkhoda and Hansalpur, with an existing capacity of around 24 lakh units per annum and a production capability of up to 26 lakh units annually. This includes output from the erstwhile Suzuki Motor Gujarat Pvt Ltd, which has since been amalgamated with MSIL.
Importantly, the company said its existing capacity is fully utilised, highlighting the need for fresh investments to support future growth. While the timeline for the proposed capacity addition will be finalised later, the board will approve the phased installation plan in due course.
The cost of land acquisition, development and preparatory activities at the Gujarat site has been approved at ₹4,960 crore. However, the total investment required for the capacity expansion project will be determined once the phasing and installation plans are finalised. The company said the expansion will be funded through a combination of internal accruals and external borrowings.
Industry analysts view the move as aligned with Maruti Suzuki’s long-term strategy to consolidate its leadership in the domestic passenger vehicle market while scaling up exports amid growing global demand for India-made small cars and SUVs.
Gujarat has emerged as a key manufacturing hub for the automaker, offering logistical advantages and policy support, and the proposed expansion at Khoraj is expected to further strengthen Maruti Suzuki’s production base in the state.
The board approval comes at a time when the Indian passenger vehicle market continues to show resilience, with demand driven by rising incomes, improving product mix and strong rural recovery, even as automakers prepare for heightened competition and evolving emission and safety norms.