India (Part 2): Suzuki builds new plant and sets up premium car sales channel

GM and Ford to each invest USD 1 billion; Honda raising production capacity

2016/01/26

Summary

 This report is the second in a series on India, and will focus on recent developments by major non-Indian OEMs, including Maruti Suzuki India Limited. The next report will feature India-based OEMs such as Tata Motors and Mahindra & Mahindra.

 India is expected to grow to become one of the top automotive markets in the world after China and the USA. Moreover, it is considered to be one of the most important markets in the world today by global OEMs, who are increasing production capacities there. In line with this, Maruti Suzuki is engaging in new endeavors such as opening its New Exclusive Automotive Experience (NEXA) premium-model sales channel.

Increasing production-capacity

 Suzuki Motor Corporation is building a new plant with an annual production capacity of 250,000 units in Gujarat State, which is scheduled to launch operations in 2017. General Motors Company and the Ford Motor Company are each investing USD 1 billion to expand their production systems. GM is closing its aging Halol Plant and expanding its Talegaon Plant, while Ford increased its annual production capacity, which had been 200,000 units, to 440,000 in March 2015. Honda Motor Co., Ltd. will increase its annual production capacity by 60,000 units in 2016. The companies are planning to consolidate India as a base for exports.  

New endeavors by OEMs

  Maruti Suzuki has begun sales of the S-CROSS and Baleno through its newly established NEXA sales channel, which provides a buying experience with premium models. The company also released two hybrid models. It is aiming to enter the light commercial-vehicle market in 2016.  

 The Renault-Nissan Alliance launched sales of the Renault Kwid, a low-cost vehicle, priced at INR 257,000 (USD 3,850).

 GM plans to release 10 new vehicles in India over a five year span. GM's plan to invest USD 5 billion in emerging countries (India, China, Brazil, Mexico, etc.) is part of its global strategy to develop a new series of vehicles that will sell 2 million units a year around the world.


(Note) The conversion rate used for local prices is INR 1=USD 0.015.



Related Reports: India (Part 1): Auto industry envisions quadrupling in next ten years (Jan. 2016)