Car manufacturing to be done in Guj,GGN facility to be used as diesel engine hub: Maruti

The first iconic Maruti 800 had been rolled out from Maruti’s facility in Gurgaon, now three decades later the Gurgaon facility will be turned into engine-making hub. Maruti Suzuki Chairman RC Bhargava stated that Gurgaon is not an industrial area anymore, with residential and corporate offices coming up the space has become too crowded for an assembly plant. Also the enormous traffic movement because of large scale manufacturing of cars creates huge obstruction. Maruti’s is planning to go slow on the deal and will decongest the Gurgaon plant in phases. The company plans to slash down the production to a mere 7 lakh cars from a million units and has already put a stop to two manually operated assembly lines this year.

Maruti is eyeing to buy a mammoth two 600-acre land in Gujarat, one lot will be reserved for assembly unit other would go to the vendors for apparatus and other secondary workings. Maruti is going to take a final decision on Gujarat in the coming six weeks when the land is going to be allotted. Also the facility at Manesar has no scope for expansion so that too will be shifted to Gujarat in turn making Gujarat a hub for making Maruti cars in India. Maruti Suzuki operations at the Gurgaon facility were plagued as the company was having continuous riots with Residents' Welfare Association, claiming that the manufacturing operations were creating a turmoil in the adjoining residential colonies also themoving cars and trailertruckswasbecoming a problem in Gurgaon.

Maruti is eyeing to build a mammoth 2 million cars-a-year facility in Mehsana, Gujarat. It seems like Gujarat is popular in the list of auto majors with most of them shifting their facility in Gujarat. The last few years have been rough on Maruti, and the company was fighting on internal as well as external level. Both its plant in Manesar and Gurgaon were undergoing labour trouble coupled with all these external issues have forced Maruti to rework its strategy. The company faced a heavy loss of around Rs 2,540 crore in sales with the production unit going down by 83,000 units. Maruti is not planning to make any new investment in any three car facility at Gurgaon and all the future investment will go for the secondary operations.

Maruti is going to stop production at its older facility  and shift it to new automated plant, that will help the company to increase the quality as well as will lower down the dependency on labor as the new unit is fully automated. Maruti India now needs a new portfolio that too quickly as the onslaught from foreign companies like Volkswagen AG and Toyota have intensified the Indian car market scenario. Maruti Suzuki India’s largest carmaker is expanding its diesel engine capacity with building an entirely new facility at Mehsana, Gujarat. Maruti Suzuki is going to invest a whooping Rs.1700 crore to doublethe diesel engine capacity at its Gurgaon facility to six lakh units by 2014. Out of  this, Rs 950 crore is being invested in  the first phase for1.5 lakh diesel engines to be churned out by mid-2013.