A significant portion of the Rs 6,000 crore (Rs 60 billion) investment planned by Suzuki Motor Corporation in India will go into the modernisation and upgradation of the Maruti Udyog Ltd plant at Gurgaon. The investment is to bring the plant at par with Suzuki's flagship plant at Kosai, Japan, within the next one year.
"Kosai is the existing showpiece of Suzuki worldwide. Maruti's Gurgaon plant will become the second showpiece by 2005. It will match Kosai in terms of all measurable parameters such as quality and efficiency," sources said.
Maruti Udyog is a 54 per cent subsidiary of Maruti. To meet this objective, investments will be made to 'scrap and build' the Gurgaon plant. This will include replacing old machines with new.
However, sources said, it has not yet been decided how much exactly will be invested in the exercise, though he added it would be substantial. The plant can make up to 250,000 vehicles per annum.
The proposed new car assembly plant at Manesar in Haryana, in which Maruti will hold a 70 per cent stake, would be at a par with the Gurgaon and Kosai plants in all respects. "This one is going to be right up the ladder," sources said adding that senior Suzuki and Maruti functionaries have already conveyed this to the government. "The government has been told that it will be a modern and state-of-the-art plant," sources said.
Senior officials in the ministry of heavy industry had indicated that the equity investment in the new plant could be as high as Rs 1,200 crore (Rs 12 billion). The plant will have a capacity to make 250,000 cars per annum.
It was announced that Suzuki would invest Rs 6,000 crore (Rs 60 billion) in the automobile business in India over the next five years in a phased manner.
Sources said this would be in the car assembly plant at Manesar, a new venture for making 100,000 diesel engines per annum also at Manesar and replenishing and refurbishing the Gurgaon plant of Maruti.