Osamu Suzuki, Chairman and CEO of Suzuki Motor Corporation mentioned that the new facility coming up in the state of Gujarat should be completed by 2017.
With the completion of this facility, the total production capacity of Maruti Suzuki cars will double to 3 million units from the current 1.5 million units produced at the Gurgaon and Manesar facilities. Maruti Suzuki India Limited (MSIL) is still in the process of getting approvals from their minority shareholders to allow Suzuki Motors to own and invest in this upcoming facility. If the contract manufacturing agreement terminates, the Gujarat subsidiary would be transferred to MSIL at book value and not at fair value as planned before.
Total investments by Suzuki in this new facility are to the extent of $488 million. Suzuki will supply cars from this facility to MSIL, and MSIL should focus more on product development and marketing.
Suzuki selected the state of Gujarat considering a good supply of infrastructure and supply of power.
Source – Economic Times