Suzuki Motors to invest Rs.10,440 crore in Indian EV segment

5paisa Research Team 5paisa Research Team 8th August 2022 - 07:03 pm

For a long time, Maruti Suzuki has been maintaining its stand that electrical vehicles (EVs) were not a viable proposition in India on a bulk scale. The argument proffered is that the diesel and petrol cars would be around for much longer than people imagine.

Maruti has been consistently holding on to the view that EV was a business where getting economies of scale would be tough in India. Now that thought process appears to be changing.

Suzuki Motor Corporation of Japan, the parent company of Maruti Suzuki, is planning a massive Rs.10,440 crore investment in India in the electrical vehicles (EV) segment.

Bulk of the fresh investment will help to fund the development of an all-new electric SUV which would be built at the Gujarat plant of Suzuki Motors. This moves is expected to enable the company to take a big leap towards the fast growing space of electrical vehicles.

Suzuki Motor Corporation is now seriously looking to strengthen its EV gameplan. In terms of timelines, Suzuki plans to roll out its first all-electric SUV built at the Gujarat plant by the year 2025.

This made-in-India electric SUV will be sold as a Maruti as well as a Toyota model in India and would also eventually be made available in international markets. The investment of Rs.10,440 crore will be largely used for EV and EV battery development.

Party to the MOU	Project Details	Investment	Completion
Suzuki Motor Gujarat	Enhance production capacity of battery electrical vehicles (BEV)	Rs.3,100 crore	2025
Suzuki Motor Gujarat	Building plant for manufacture of BEV batteries based on customized design	Rs.7,300 crore	2026
Maruti Suzuki Toyota	Construction of vehicle recycling plant in collaboration with Toyota	Rs.45 crore	2025

To begin with, the target is to manufacture 125,000 EVs at the Gujarat plant. Suzuki Motor Corporation has already signed the MOU with the Gujarat government during the ongoing India-Japan Economic Forum at New Delhi.

As per the MOU, Suzuki will also build a new factory to manufacture EV batteries to complement the ecosystem. Suzuki plans to make a debut in the Indian market with a mid-sized sports utility vehicle (SUV).

The product development by Suzuki Motor will be done on the 27PL platform. This is a popular skateboard architecture meant for small electric vehicles and has been adapted from Toyota’s 40PL global platform. Toyota also plans to launch its own equivalent of the all-electric model.

The Maruti Suzuki Toyota EVs will also be exported from India, part of the plan to make India an export hub under the Make in India and Atma Nirbhar plans.

The plan is that the YY8 and its sister model will be global products and therefore the potential for exports will be a major factor for Suzuki and Toyota.

These models are planned to debut in Europe around October 2024 and the launch in India would only be in the first half of 2025. Out of the production of 125,000 cars, a total of 60,000 will be for the Indian markets, 40,000 cars for European markets and around 25,000 cars for Japan.