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    Maruti Suzuki may shift entire Swift production to Gujarat; mulls 3 million production by 2025

    Synopsis

    Maruti Suzuki has acquired a land bank for the 4-6th plants in Gujarat. The plants will be readied to meet the requirements of the slew of upcoming models that are planned by the company till 2020.

    ETAuto
    NEW DELHI: The country’s largest carmaker by volumes, Maruti Suzuki India is aggressively growing its production capacity in Gujarat through Suzuki Motor Gujarat (SMG).

    This additional capacity will meet the rising market demand for new models, especially those planned till 2020.

    Sources in the know told ETAuto that Maruti Suzuki is gunning for a production of 3 million units by 2025, after the initial 2 million is crossed in 2020.

    The first 1 million units was reached in 15 years for the Japanese carmaker.

    RC Bhargava, chairman of Maruti Suzuki India, when contacted said that the target of 3 million is yet to be finalized.

    “The way Maruti Suzuki is currently growing, 3 million seems highly achievable. But in the long-term, disruptions in the market are expected after 2020, due to CAFÉ norms, safety norms and new entrants,” said Gaurav Vangaal, Senior Automotive Analyst, IHS Markits.

    Meanwhile, the new generation Swift hatchback that will also be made at parent Suzuki Motor's Gujarat plant is to kick off production from 1 December with full ramp up to happen by January-February 2018, when the manufacturing facility will reach a production capacity of 900-1000 units daily.

    It is believed that since Suzuki cannot produce more than 250,000 units in its current plant, it could shift the entire Swift production to Gujarat. The existing Swift is made at the Manesar facility in Haryana as well. Sources say that this option is under evaluation stage at present.

    The Baleno production could then be shifted to Manesar to optimise use of the space vacated by the Swift. This strategy would be followed by the carmaker till the second facility in Gujarat is operational. The latest version of the Swift being a new model is expected to be given priority in production in 2018.
    At present, about 550 units of the premium Baleno hatchback are made daily in Gujarat.

    Sources say that with the carmaker taken by surprise by the sudden demand for their new models, especially the Vitara Brezza and the Baleno, Maruti Suzuki will need to rejig its production schedule before too long due to capacity constraints that continue to persist.

    The existing Swift hatchback sold 12,057 units during October 2017 down from 14,611 units in the same month last year.

    The Baleno sold 14,532 units during this October up from 10,718 units in the same month last year.

    Going on stream earlier this year, the Gujarat facility located in Mehsana district, commenced production with 10,000 units per month or about 330 units daily from single shift operations.

    In October, the carmaker added the second shift and with this it has upped the production capacity further.

    The first manufacturing facility of Suzuki Motor Gujarat can produce 250,000 units annually at full capacity.

    The company’s second plant is expected to go on stream by 2018-end or early-2019, and the third facility to become operational by 2020. Each will add a capacity of 250,000 units annually.

    In the meantime, Maruti Suzuki has acquired a land bank for the 4-6th plants in the vicinity. The plants are being readied to meet the requirements of the slew of new model launches that are planned by the company till 2020.

    At the last Auto Expo 2016, Kenichi Ayukawa, Managing Director & CEO of MSIL, mentioned that it would rollout 15 new models by 2020.

    Globally, Suzuki will launch 20 new models. To accommodate all these fresh launches, Maruti Suzuki is eliminating all capacity constraints with new facilities in the western state.

    Next year should see the new generation Ertiga and WagonR coming. Also on the radar are more SUVs, along with the new gen Celerio and Alto K10 models.

    In addition, an electric car is also being developed with Toyota for the Indian market by 2020. Japanese parent Suzuki Motor Corp has already announced plans to set up a lithium-ion battery plant, with component maker Denso and Toshiba Corp in Gujarat.

    With all the new developments in the pipeline, Maruti Suzuki is in need of excess capacity and, therefore, all the production reshuffles could stem from that.


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