New Delhi: Maruti Suzuki India Ltd (MSIL) has received board approval to acquire land from the Gujarat Industrial Development Corporation (GIDC) at Khoraj Industrial Estate, marking the first formal step towards a significant expansion of its production capacity. The proposed expansion could add up to 1 million vehicles per annum, underscoring the automaker’s confidence in sustained growth in both domestic and export markets.
In a regulatory filing to stock exchanges on Monday, the company said its existing manufacturing capacity of around 24 lakh units per annum—spread across Gurugram, Manesar, Kharkhoda and Hansalpur—has the capability to produce up to 26 lakh units annually and is currently fully utilised. This capacity includes output from the erstwhile Suzuki Motor Gujarat Pvt Ltd, which has since been amalgamated with Maruti Suzuki India.
The board has approved an outlay of ₹4,960 crore towards land acquisition, development and preparatory activities for the new facility. However, the phasing of the capacity addition, overall project cost and timeline will be finalised later, once detailed installation plans are framed and brought back to the board for approval.
Maruti Suzuki said the proposed expansion will be financed through a combination of internal accruals and external borrowings, indicating a calibrated approach to funding while maintaining balance sheet strength. The rationale for the investment, the company noted, is growth in market demand, including exports, at a time when India is emerging as a key global hub for small car manufacturing.
The move comes as India’s passenger vehicle market continues to show resilience, with strong demand for compact cars, SUVs and entry-level vehicles—segments where Maruti Suzuki retains a dominant market share. The Gujarat location is seen as strategically important for exports, given its port connectivity and established automotive ecosystem.
While the company has not disclosed when the additional capacity will come on stream, analysts see the land acquisition as a long-term bet on volume growth over the next decade, especially as Maruti Suzuki ramps up its export ambitions and prepares for future product launches, including cleaner and more efficient powertrains.
Maruti Suzuki India, headquartered in New Delhi, remains the country’s largest passenger vehicle manufacturer and a key subsidiary of Japan’s Suzuki Motor Corporation.