India (Common Wealth) _ According to company chairman RC Bhargava, speaking at the company’s annual general meeting, Maruti Suzuki India plans to invest approximately Rs. 45,000 crore over the next eight years to increase its annual production capacity to 40 lakh vehicles. The corporation is also exploring stock split proposals from shareholders.
As per the views of Bhargava, in the ever-changing landscape of the global auto industry’s pursuit of carbon neutrality, Maruti Suzuki will engage with a variety of technologies, including electric vehicles (EVs), hybrids, CNG, ethanol-blended, and compressed biogas, because predicting the trajectory of new technologies over the next decade is difficult.
While the company has reached a milestone of “two million units of production and sales in 40 years,” Bhargava says it is now hoping to add another two million units during the next eight years while also considerably boosting the company’s turnover.
“The era ahead of us will be a very uncertain and challenging era.” Building these 2 million autos will cost us close to Rs. 45,000 crore. It depends on inflation, but for now, we estimate the cost to be around Rs 45,000 crore for 2 million cars,” Bhargava added.
Maruti Suzuki’s ‘Maruti 3.0’ strategy calls for the company to increase its production capacity by 20 lakh units and introduce about 28 new models.
Bhargava also addressed worries about Maruti’s electric vehicle program, claiming that while the business may be behind other competitors in terms of EV launches, entering the market in 2024-25 will not jeopardize its potential to capture a significant market share. He emphasized that Maruti’s management, engineers, and partners conducted a thorough assessment of the Indian EV environment and have planned the manufacturing of six EV models between 2024-25 and 2030-31.
In terms of the market landscape, Bhargava acknowledged the drop in small vehicle demand and Maruti’s subsequent endeavor to strengthen its presence in the rapidly developing SUV class. We were basically a small car producer, and we now have to adjust to the fact that small cars are declining due to regulatory and other considerations, while the market for SUVs is expanding.
He reaffirmed the company’s intention to regaining market share in the coming years by aligning its initiatives with changing customer preferences. On Tuesday, Maruti Suzuki, the country’s largest manufacturer by volume, approved the issuance of equity shares to its parent, Suzuki Motor Corporation, to pay for the Gujarat factory it would purchase from its Japanese parent.
According to the firm, the Gujurat plant has a book value of Rs 12,755 crore. The business stated on Tuesday that the actual deal value, including the issue price and number of shares, will be determined at a subsequent board meeting.
Suzuki was given preferential shares because it was “the most beneficial option for minority shareholders and the company.” Maruti said.
Maruti’s purchase of Suzuki’s facility, revealed last week, provides it a greater grasp on manufacturing, including that of electric vehicles, and would allow it to make necessary modifications based on demand, according to chairman RC Bhargava.
According to a Mumbai-based expert, Suzuki Motor Corporation’s stake in Maruti Suzuki will rise by roughly 4% as a result of the acquisition. Maruti Suzuki shares have dropped roughly 2.5 percent after the company reported quarterly earnings on July 31 but car maker is optimistic on future investment.
Maruti Suzuki India Limited (previously Maruti Udyog Limited) is Suzuki Motor Corporation’s Indian subsidiary. As of September 2022, the business held a 42 percent market share in the Indian passenger automobile market. The company is well-known for producing low-maintenance automobiles for the Indian market.
