Japan's Suzuki Motor Corporation said on March 20 it plans to invest 150 billion yen (about Rs 10,440 crore) in ramping up production capacity for electric vehicles as well as setting up an EV battery manufacturing plant and vehicle recycling unit in Gujarat.
The memorandum of understanding with the state government was signed on March 19 at India-Japan Economic Forum held in New Delhi in the presence of Japanese prime minister Fumio Kishida and Indian PM Narendra Modi.
Speaking at the forum, Toshihiro Suzuki, representative director and president of Suzuki Motor Corporation, said, "Suzuki's future mission is to achieve carbon neutrality with small cars."
He added, "We will continue active investment in India to realise self-reliant India (Atma-Nirbhar Bharat)."
This is an important step for Maruti Suzuki as it marks the EV foray for Suzuki Motor Corporation’s Indian arm. However, no change has been announced in the EV launch timeline which Maruti had set as 2025, hence earnings won't get any immediate bump from EVs although the sentiment will continue to remain positive.
Under the MoU mentioned above, Suzuki Motor Corporation's wholly owned Suzuki Motor Gujarat Pvt Ltd (SMG) will invest Rs 7,300 crore for the construction of battery plant near SMG’s automobile manufacturing unit by 2026. SMG will invest another Rs 3,100 crore for ramping up production capacity for EVs by 2025.
Moreover, another group firm Maruti Suzuki Toyotsu India Pvt Ltd will invest Rs 45 crore in construction of vehicle recycling plant by 2025. This comes after Maruti Suzuki and Toyota Tsusho Group had announced in November 2019 a joint venture for vehicle dismantling and recycling and set up a unit in Noida, Uttar Pradesh.
Maruti Suzuki had previously scrapped plans to launch EVs in 2020 due to lack of infrastructure and government support.
The announcement by Suzuki Motor Corporation comes after Japan on March 19 announced an investment of Rs 4,20,000 crore in India in the next five years following talks between Modi and Kishida.