Fifth Maruti Suzuki Plant Decision Near: GST Boosts Small Car Sales

The establishment of Maruti Suzuki’s fifth manufacturing facility is nearing a decision point, according to Chairman R. C. Bhargava. He revealed that an official announcement is expected within the next few months. This development aligns with a revitalized demand for small cars in India, a segment that has seen a significant uplift following the recent GST rate cuts. Bhargava observed that this resurgence might lead other automakers to re-evaluate their vehicle portfolios. The company is also in the process of updating its ambitious long-term vision, which previously targeted a turnover of approximately Rs 1.68 lakh crore by 2030-31 and an annual production of 40 lakh units. While the second quarter financial results do not yet fully capture the GST’s influence, projections indicate a substantially stronger second half of the fiscal year in terms of sales volume. The new Gujarat plant represents a significant investment of Rs 35,000 crore and is a key component of Maruti Suzuki’s expansion strategy. The positive impact of GST is already evident in the entry-level car segment, where sales contribution has climbed to 20.5% from 16.7%.