Barely two weeks after signing an agreement with the Gujarat government for setting up a manufacturing facility at Hansalpur near Mehsana, leading passenger carmaker Maruti Suzuki India Ltd (MSIL) has sought for more land from the state government for phase two of the project. It has been allotted 700 acres of land at the site located around 100 kilometers(km) from Ahmedabad.
Confirming the development a senior government official said on grounds of anonymity, "Yes, Maruti is looking for another land parcel of around 300 acres for phase two of the project. It could be used to house the company's vendors or for the company's own capacity expansion plans." The land would not be exactly adjacent to the plot allotted to the company in Hansalpur, but is likely to be around 10-12 km away from the site, the official added.
MSIL signed a state support agreement (SSA) with the state government for purchase of land near Mehsana on June 2. The company said that it would invest Rs 4,000 crore in the first phase to set up a 250,000 units per annum plant by 2015-16. The new facility will take MSIL's combined capacity to two million units in three to four year's time. The company's Gurgaon and Manesar plants will have a net installed capacity of 17.5 lakh units per anuum once a third assembly line (Manesar C plant with 2.5 lakh units annually) goes onstream by mid-2013-14.
A top level delegation comprising Shinzo Nakanishi, managing director and CEO of MSIL and R C Bhargava, chairman, MSIL had met Gujarat chief minister Narendra Modi in May last year to discuss potentials for setting up its first plant outside Haryana.
Maruti Suzuki officials could not be reached for a comment on the same.
Speaking at the SSA signing ceremony, Nakanishi had said that with taking the first step in Gujarat, Maruti Suzuki is entering into a new phase of its business life.
As the industry crosses over four million cars by 2015-16, Maruti's Gujarat plant would take its combined capacity to two million units by the same time. The Hansalpur plant is thus critical to MSIL if it wants to maintain its 50 per cent market share in the passenger car industry in the country.