Suzuki Motor to Expand their Production Line

India: Japan automobile giant, Suzuki Motor Corp is going to expand their market penetration in India. The company would be investing USD970.97 million in its second production line plant in Gujarat. The manufacturing at new plant would be operational by 2019, which is anticipated to reduce the waiting time for car delivery by Suzuki and is expected to produce a similar volume, annually, as of first production line, which is estimated to debut by 2017.

It is expected that with this investment, the production capacity by Suzuki would increase to 2 million cars, annually. Besides manufacturing of Baleno hatchback, the vehicles produced in the new factory at Gujarat would also be exported in various other markets.

Maruti Suzuki India invested about USD2.77 billion in the Gujarat plant during December 2015, to increase the manufacturing potential of six production lines to 250,000 vehicles, each. In 2016, Suzuki Motor stated that India being its biggest market, recorded an inflating growth of 5.2% in April-June period.

As per TechSci Research, the recent investment pooled in by Suzuki in India, is likely to expand its production of cars in the country in coming years. Consequent to which, the step taken by the company would generate an emerging demand for tires in India’s OEM market, which would eventually, influence the overall tire industry of the country in approaching years.

According to a recent report published by TechSci Research, “India Tire Market Forecast & Opportunities, 2021’’, the country’s tire market is forecast to witness a CAGR of over 9% during 2016-2021. Though the replacement tire demand had a majority share in 2015, the OEM tire demand is expected to outpace replacement tire demand during 2016-2021. In 2015, Northern region accounted for the largest share in India’s tire market, followed by Southern, Eastern and Western regions of the country. Over the next five years as well, Northern and Southern regions are forecast to continue their market dominance and grab a cumulative market share of nearly 59% in 2021. Two-wheeler tire segment, which accounted for a volume share of over 50% in the country’s tire market in 2015, is also expected to maintain its position as the largest tire segment over the next five years.