Maruti Suzuki Invests ₹35,000 Crore in New Gujarat Plant, Aims for 1 Million Annual Capacity

Introduction to a Major Automotive Expansion

Maruti Suzuki India Limited (MSIL), the nation's largest automobile manufacturer, has announced a landmark investment of ₹35,000 crore to establish a new, state-of-the-art manufacturing facility in Khoraj, Gujarat. This strategic move is set to significantly enhance the company's production capabilities, with the new plant designed to produce one million (10 lakh) vehicles annually. The project, formalized in a ceremony in Gandhinagar, underscores Maruti Suzuki's commitment to the 'Make in India' initiative and is poised to create over 12,000 direct employment opportunities, further cementing Gujarat's status as a premier automotive hub in the country.

A Landmark Investment for Indian Manufacturing

The formal announcement was made during an investment letter handover ceremony attended by Gujarat Chief Minister Bhupendra Patel and Maruti Suzuki's Managing Director, Hisashi Takeuchi. Chief Minister Patel highlighted the project's alignment with Prime Minister Narendra Modi's 'Make in India, Make for the World' vision. He stated that the investment not only strengthens India's manufacturing ecosystem but also deepens the trusted India-Japan partnership. The presence of Maruti Suzuki, he added, reflects global confidence in Gujarat's policy-driven governance, world-class infrastructure, and industry-friendly environment. This development is expected to act as a powerful catalyst for the growth of ancillary units and Micro, Small, and Medium Enterprises (MSMEs) within the state.

Project Scale and Specifications

The new facility will be constructed on a vast 1,750-acre plot of land provided by the Gujarat Industrial Development Corporation (GIDC) in Khoraj. The total planned annual capacity of one million vehicles represents a substantial addition to Maruti Suzuki's overall output. According to state government officials, the development will be executed in four distinct phases, with each phase contributing 2.5 lakh vehicles per year to the total target. Production at the new site is anticipated to commence in the fiscal year 2028-29, marking a significant milestone in the company's long-term expansion strategy. This investment follows a recent MSIL board approval for a ₹4,960-crore proposal specifically for the acquisition of this land.

Strategic Expansion Amidst Record Growth

This major investment comes on the heels of a period of robust performance for Maruti Suzuki. In the calendar year 2025, the company achieved its highest-ever production, manufacturing over 22.55 lakh vehicles. It was the second consecutive year the company surpassed the 20-lakh unit mark. Exports also reached a new peak in 2025, with 3.95 lakh vehicles shipped, marking a growth of over 21% compared to 2024. This strong demand, both domestically and in international markets, necessitates a significant ramp-up in production capacity. The new Gujarat plant is a direct response to this need and is a critical component of the company's ambitious goal to nearly double its total output to 4 million units by 2031.

Economic Impact on Gujarat

The economic implications of this ₹35,000 crore investment are substantial for the region. The creation of over 12,000 direct jobs, along with an estimated 7.5 lakh indirect employment opportunities, will provide a significant boost to the local economy. The project is expected to stimulate demand for local suppliers, logistics providers, and various service industries, fostering a vibrant and self-sustaining economic ecosystem around the plant. This influx of capital and employment will likely improve livelihoods and drive further infrastructure development in the surrounding areas, solidifying Gujarat's reputation as a leading destination for global investors in the automotive sector.

Key Project Details

Complementing Existing Operations

The new Khoraj facility is designed to complement Maruti Suzuki's existing operations in Gujarat. The company already runs a significant manufacturing plant at Hansalpur, which currently produces 7.5 lakh vehicles annually. That facility is already undergoing an expansion to scale its capacity up to 10 lakh units by the fiscal year 2027. With both the Hansalpur and the upcoming Khoraj plants, Gujarat will become a central hub for a large portion of Maruti Suzuki's future domestic and export manufacturing activities, creating a powerful dual-plant presence in the state.

Future-Forward: A Nod to Electric Vehicles

While this investment focuses on expanding conventional vehicle production, Maruti Suzuki is also actively planning for the future of mobility. The company has announced a separate investment of ₹3,200 crore to add a fourth production line at its existing Suzuki Motor Gujarat facility in Hansalpur. This new line will be dedicated specifically to manufacturing electric vehicles (EVs) and is expected to become operational by the fiscal year 2026-27. This move indicates a balanced strategy, scaling up current production while simultaneously building capacity for the next generation of automobiles.

Conclusion

Maruti Suzuki's ₹35,000 crore investment in the new Khoraj plant is a transformative step for the company, the state of Gujarat, and the Indian automotive industry at large. It reinforces the company's dominant market position while contributing significantly to regional industrial growth and employment. As the project progresses towards its scheduled commencement in FY 2028-29, it will be instrumental in meeting future market demand, strengthening India's manufacturing capabilities, and helping Maruti Suzuki achieve its long-term vision of producing 4 million vehicles annually.