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Maruti: Land bank for dealerships

Maruti: Land bank for dealerships
Written by Parichay Malvankar

With real estate prices on a constant rise, it is becoming difficult for dealerships to find a viable mix to stay profitable in the business. Country’s largest car manufacturer, Maruti Suzuki now plans to step into the real estate sector and provide some relief to the dealerships.

With over Rs. 9,000 crore funds, the company plans to buy land across major towns and cities and lease it out to dealerships. The company is also planning to double its current touch points i the next five years and increase annual sales units to 2 million. These land purchases will be made across Tier 1, Tier 2 and Tier 3 cities and the decision is very close to being made.

Maruti plans to recover the investments via lease rentals and appreciation in real estate prices.

Source – ET Auto