After Tata Motors and General Motors India, Gujarat could be home to India's largest selling passenger car maker, Maruti Suzuki India Ltd's (MSIL) first factory outside Haryana.
MSIL has evinced interest in setting up a car manufacturing unit in Gujarat, already home to Tata Motors' Nano project. Chairman R C Bhargava and managing director Shinzo Nakanishi met state chief minister Narendra Modi here today and expressed intent to set up a plant in Gujarat on a 500-acre plot, with a capacity to produce a million cars per annum, the state government said.
"We are exploring the possibilities of setting up a new plant and future expansion in Gujarat. The CM and the state government's response was positive," Bhargava told journalists outside Modi's residence after meeting him.
He, however, made it clear the company was still exploring various possibilities and nothing had been finalised. "It is too early to say anything about location of the proposed plant, as we have not yet decided anything about it. The state government has showed us a few locations and it will take two to three months to finalise," he said, adding there was a strong probability of Maruti coming to the state.
MSIL plans to expand its manufacturing capacity in a phased manner. In the first phase, it is looking at adding capacity of a million units per annum, requiring investment of Rs 6,000 crore, including a vendors' park. Another million-unit capacity could be added in a second phase with investment similar to the first, which is estimated to take five years for completion.
"Looking at a capacity of one million cars, we have a need for 500 acres, plus a similar amount of land for the vendor park. More, looking at the future passenger car market, we may need to expand by another one million units. In all, we need roughly 1,500 acres. On its part, the Gujarat government is ready to offer us as much land as we need. We are keeping our options open but Gujarat seems to be a high probability state for us," said Bhargava.
The company’s technical team would, he said, evalue the land options.
According to industry estimates, the automobile industry in the country is slated to touch 4.5- 5 million units’ of annual capacity by 2013-14. MSIL has an installed capacity of 1.2 million cars per annum at Gurgaon and Manesar, and is in the process of setting up two more factories at Manesar. A company spokesperson said the first would come onstream within this year and the second plant by 2012-13.