With Maruti Suzuki India Limited (MSIL), the number one car maker in India, recently declaring its intention to invest a colossal amount of revenue, estimated to be about $3.9 billion, in a new production plant, the automotive landscape in India is bound to change radically. This strategic step, which is expected to increase the capacity of the company tremendously to match the soaring demand in both local and foreign markets, is as per the state government of Gujarat and regulatory filings. The move highlights the fact that Maruti Suzuki has been keen on the Make in India program and its long-term goal of increasing its annual production capacity to 4 million units by 2030-31.

Strategic expansion and growth strategy

The new mega-plant will be situated in Gujarat in the Khoraj Industrial Estate in Sanand, around 30 kilometers off Ahmedabad. This is the second large-scale production center of Maruti Suzuki in the state, which has an existing center in Hansalpur. The Gujarat government emphasized how the Sanand location is well-developed in terms of supply chain, has strong infrastructure as well as close to major ports, and that makes Sanand an ideal location to export complete vehicles to international markets.

The first stage of this growth is a board-approved budget of ₹4,960 crore for land acquisition, site development, and preparation. It is anticipated that the new plant will increase the production capacity by 1 million units (10 lakh) annually, which will later translate to 2 million units in total yearly production capacity in the state of Gujarat itself.

One of the key aspects of the growth strategy of Maruti Suzuki is the move to sustainable mobility. During the Vibrant Gujarat Global Summit, the automaker announced that it was going to combine the advanced manufacturing lines to enable the manufacture of electric vehicles (EVs). Maruti Suzuki is also setting up a fourth production line in its existing Hansalpur plant (previously Suzuki Motor Gujarat) with an investment of ₹3,200 crore, with a specific purpose of increasing EV production since FY 2026-27.

The initial electric model of the company will be an electric sports utility vehicle (SUV), which will be produced in the state of Gujarat, with the initial production being exported to Europe and Japan. Through its existing relationship with Toyota Motor Corporation, Maruti Suzuki will utilise India as a key global hub in exporting EVs, and is envisioning 6 EV models in the portfolio by the decade.

Investment and capacity milestone

The investment of $3.9 billion will be covered by internal accruals and external borrowings. Such capital injection is required because the present annual capacity of about 2.4 million units of Maruti Suzuki is almost being utilized. The 2025 fiscal year recorded the highest annual production in the company at 2.255 million units due to high performance in the SUV and compact car segments.

Maruti Suzuki is undertaking several projects at the same time to achieve the target of 4 million units by FY 2030-31. These are the new Gujarat facility, the expansion of the Hansalpur facility, and the continued development of its current huge greenfield in Kharkhoda, Haryana. All these are geared towards ensuring that Maruti Suzuki maintains its leading market share in India and substantially expands its export base, which has 2.6 times more exports today than it did a decade ago.

Conclusion

Maruti Suzuki $3.9 billion is a bold step in strengthening its leadership in the automobile industry, which is one of the fastest-expanding in the world. With the emphasis on high-capacity mega-plants, electric vehicle preparedness, and strategic export centers, the company is preparing to sail through the complicated transition to cleaner energy and satisfy the mass-market needs of an increasing number of middle-class citizens.

When the Sanand plant starts its operations in FY 2028-29, it will become a foundation for the global ambitions of Maruti Suzuki and the ambition of the Indian government to become a global manufacturer.