Suzuki to set up third plant, lithium ion bat­tery unit in Gu­jarat

Financial Chronicle - - COMPANIES - FC BU­REAU

JA­PAN'S Suzuki Mo­tor Corp on Thurs­day an­nounced fresh in­vest­ments of around Rs 3,800 crore in Gu­jarat to add a third car pro­duc­tion plant.

The com­pany along with its part­ners Toshiba and Denso will also in­vest around Rs 1,150 crore for a new unit to pro­duce lithium ion bat­ter­ies.

The new in­vest­ment in en­hanc­ing ca­pac­ity of the Hansalpur plant will take the com­pany's to­tal in­vest­ment in the fa­cil­ity to around Rs 13,400 crore, where it has al­ready put in Rs 9,600 crore on two plants along with an­other en­gine and trans­mis­sion pro­duc­tion unit.

The Hansalpur-based plant is Suzuki Mo­tor Corp's first wholly-owned unit in In­dia.

An­nounc­ing the fresh in­vest­ments, Suzuki Mo­tor Corp (SMC) chair­man Osamu Suzuki said the com­pany will in­vest Rs 3,800 crore on the third plant which will have a pro­duc­tion ca­pac­ity of 2.5 lakh units an­nu­ally.

When the third plant starts func­tion­ing fully, the SMC's Gu­jarat plant will have a to­tal ca­pac­ity of 7.5 lakh units per an­num. He, how­ever, did not elab­o­rate on the time for com­mis­sion­ing of the third plant.

The first two plants also have ca­pac­ity of 2.5 lakh units per an­num, while the en­gine and trans­mis­sion unit has a ca­pac­ity to pro­duce 5 lakh units a year.

The over­all pro­duc­tion ca­pac­ity of SMC along with its In­dian arm, Maruti Suzuki's two plants in Haryana will in­crease to 22.5 lakh units an­nu­ally.

Cur­rently, the first plant at Hansalpur pro­duces pre­mium hatch­back Baleno. The sec­ond plant along with the en­gine and trans­mis­sion units is ex­pected to go on stream in 2019.

He said with the new in­vest­ment, the com­pany's Hansalpur fa­cil­ity will help in gen­er­at­ing em­ploy­ment for 10,000 peo­ple, in­clud­ing sup­pli­ers.

Last week, Maruti Suzuki In­dia chair­man R C Bhar­gava had stated that SMC was also con­sid­er­ing set­ting up a fourth pro­duc­tion line of 2.5 lakh units at Hansalpur plant to take its to­tal ca­pac­ity to a mil­lion units.

Suzuki said as part of strat­egy for adapt­ing to new tech­nolo­gies, SMC along with its part­ners Toshiba and Denso will in­vest $180 mil­lion (around Rs 1,151 crore) to man­u­fac­ture lithium ion bat­ter­ies.

The bat­ter­ies will be used for "hy­brid ve­hi­cles man­u­fac­tured in In­dia and ex­port these gen­uinely man­u­fac­tured in In­dia ve­hi­cles to in­ter­na­tional mar­ket", Suzuki said.

The plant is ex­pected to be op­er­a­tional from 2020, he said adding, "We plan to con­tinue with our ef­forts to pro­mote the Make-in-In­dia pro­gramme fur­ther".

Last year, SMC had joined hands with Toshiba Cor­po­ra­tion and Denso to set up a plant in In­dia to pro­duce lithium ion bat­ter­ies. The three Ja­panese en­ti­ties inked an agree­ment to form a joint ven­ture to tap grow­ing pop­u­lar­ity for elec­tric ve­hi­cles in In­dia and sup­ply lithium-ion bat­tery packs in the coun­try.

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