The Japanese carmaker has outlined an aggressive investment and product roadmap for India which is its largest market in global operations with an aim to double revenues to Rs 4.32 lakh crore by FY31.
06 Jul 2023 | 4523 Views | By Mayank Dhingra
Suzuki Motor Corporation (SMC), the Japanese automaker which is the largest player in India’s passenger vehicle market through its entity – Maruti Suzuki India (MSIL) – aims to double its revenues by the end of this decade. The automaker targets 7 trillion yen or Rs 4.32 lakh crore in revenues ...
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Suzuki Motor Corporation (SMC), the Japanese automaker which is the largest player in India’s passenger vehicle market through its entity – Maruti Suzuki India (MSIL) – aims to double its revenues by the end of this decade. The automaker targets 7 trillion yen or Rs 4.32 lakh crore in revenues by FY31, eyeing 100 percent growth over its FY22 turnover which stood at 3.5 trillion yen or Rs 2.16 lakh crore.
To accomplish this target, SMC has outlined a total outlay of around Rs 2.8 lakh crore by FY31 into the Indian market, wherein the capital will be infused in bringing new technologies, setting up new facilities, and enriching products. The Japanese two- and four-wheeler major’s plans and strong hopes on its India operations were revealed by MSIL’s India MD Hisashi Takeuchi at the launch of the company’s flagship model – Invicto – in New Delhi on July 5.
According to Takeuchi, Maruti Suzuki India grew faster than the market in Q1 FY24, registering a 12.2 percent year-on-year (YoY) uptick, and overtaking both competition (7.1%) as well as the combined industry, which recorded a 9.2 percent YoY growth in the April-March 2023 period. “These are exciting times for MSIL and our customers. It reflects our confidence in India’s automobile market and its economy. Many of our new launches, particularly the Grand Vitara, Fronx and Jimny, as well as our determination are the reasons for these promising outcomes.”
“While these are short term results of our recent efforts, we are taking some mega steps to maintain our long-term leadership in the market. Looking at the immense potential of the Indian automobile market, our parent company - Suzuki Motor Corporation – has outlined a robust growth plan. As per SMC’s growth strategy towards 2030, it targets to achieve a global turnover of Rs 4.32 lakh crore in FY31,” he said.
“India of course, will play a very big role in this growth strategy,” Takeuchi commented. In the first three quarters of FY23, MSIL dominated SMC’s global sales volumes by growing its share from 50 to 55 percent within a year. Moreover, its revenues accounted for 41 percent of SMC’s global turnover and 45 percent of its profitability in the same period.
On January 11, 2023, Toshihiro Suzuki, president, Suzuki Motor Corporation and Hisashi Takeuch, MD, Maruti Suzuki India, revealed the Concept eVX, Suzuki's first global strategic EV at the Auto Expo.
Eyeing India’s EV potential
With a marked uptick registered by electric passenger vehicle sales, which stood at 38,359 units in H1 CY23 to record 137 percent YoY growth, EVs in India have attained a notable momentum and are increasingly becoming the preferred choice of more customers. In line with its global carbon neutrality targets, Suzuki Motor Corporation aims to tap into the huge electrification opportunity offered by its biggest car market, with a plan to roll out six new BEVs by FY31.
Maruti Suzuki’s first EV - the production version of the eVX Concept - showcased earlier this year at the Auto Expo – will launch in 2025, while the company will introduce five more all-electric products across various vehicle segments by the end of the decade. By 2030, SMC envisions around 15 percent passenger vehicle sales in India from EVs, with a dominant 60 percent share to continue coming from combustion engine vehicles, with remaining 25 percent from hybrid-electric vehicles.
“We are committed to bring six EVs across different segments by FY31. Besides, in our journey towards decarbonisation, we will continue to deploy multiple powertrain technologies such as CNG, hybrid, and introduce bio-fuels like ethanol and biogas,” Takeuchi mentioned.
Investing in new infrastructure, expanding capacity
With India overtaking Japan as the third-largest passenger car market by selling around 3.8 million units in CY2022, the country is accelerating towards unleashing its full potential of becoming the largest car market in the world. While it significantly grew its contribution to SMC’s global production to almost 60 percent in the first three quarters of FY23, MSIL is gearing for its next phase of capacity expansion to cater to future demand for its products, both in India and overseas.
“In line with the anticipated market growth by 2030, we are also expanding our manufacturing capacities. The construction at our new manufacturing facility in Kharkhoda, Haryana, is in full swing, and we plan to commission the first plant with an annual manufacturing capacity of 250,000 units by 2025,” Takeuchi said.
MSIL is investing Rs 11,000 crore in the first phase of the new Kharkhoda facility, which, once fully operational will have a total annual production capacity of 10,00,000 vehicles. “It will be one of the world’s largest, single-location manufacturing sites. In addition, we have also received the Board approval for another manufacturing facility with an annual capacity of another 10 lakh vehicles,” Takeuchi signed off.