Maruti Suzuki Board Greenlights ₹4,960 Crore Land Deal for Fifth Manufacturing Hub in Gujarat
By Cygnus | 12 Jan 2026
Maruti Suzuki India Limited (MSIL) has officially firmed up its next major manufacturing beachhead. In a regulatory filing to the BSE on Monday, January 12, 2026, the country’s largest carmaker announced that its board has approved the acquisition of land at the Khoraj Industrial Estate in Gujarat’s Gandhinagar district.
The board cleared an initial investment of ₹4,960 crore specifically for land acquisition, site development, and preparatory activities. The land will be secured from the Gujarat Industrial Development Corporation (GIDC). While the total project investment—estimated in 2024 at approximately ₹35,000 crore—will be finalized and approved in phases, this move marks the definitive start of the company’s “Vision 3.0” expansion.
The Khoraj plant is expected to commence operations in the 2028–29 financial year. The facility is designed to add a massive one million units of annual production capacity, essential for MSIL’s goal of producing four million vehicles annually by 2030–31.
Addressing Capacity Constraints
The board’s decision comes as MSIL’s current infrastructure reaches a “fully utilized” state. As of January 2026, the company operates with an installed capacity of approximately 2.4 million units per annum across Gurugram, Manesar, Kharkhoda (Haryana), and Hansalpur (Gujarat). With the recent amalgamation of Suzuki Motor Gujarat (SMG), the company reported a technical production capability of 2.6 million units, but cited rising domestic demand and a surge in export volumes as the primary drivers for this immediate capacity ramp-up.
Strategic Expansion Roadmap
The Khoraj site is part of a broader multi-state production blitz:
- Kharkhoda (Haryana): Following the successful start of commercial production in February 2025, this greenfield plant is being scaled in phases to reach its own one-million-unit annual milestone.
- Hansalpur (Gujarat): A fourth production line is currently being firmed up with an investment of ₹3,200 crore, aimed at boosting the site’s capacity to one million units by 2026–27. This line is specifically earmarked for the company’s push into Electric Vehicles (EVs), including the e-Vitara.
- Battery Localization: MSIL is also investing approximately ₹7,300 crore in a dedicated battery manufacturing plant in Gujarat to future-proof its EV supply chain.
This aggressive expansion is backed by a massive ₹1.25 trillion capital expenditure roadmap through FY31. By locking in the Khoraj location today, Maruti Suzuki is securing the logistical “headroom” necessary to defend its market leadership in India’s rapidly evolving automotive landscape.
Summary
Maruti Suzuki has officially secured the Khoraj Industrial Estate in Gujarat for its fifth plant, with the board approving ₹4,960 crore for land and initial development. The facility will eventually add one million units to the company’s annual output, supporting a long-term goal of four million units by 2031. This expansion is necessitated by the fact that the company’s current 2.6 million unit capability is already running at full utilization.
Frequently Asked Questions (FAQs)
Q1: Where exactly is the new Maruti Suzuki plant located?
The plant will be situated at the Khoraj Industrial Estate in the Gandhinagar district of Gujarat.
Q2: When will the Khoraj plant become operational?
Production is scheduled to begin in the 2028–29 financial year.
Q3: What is the initial investment for this specific project?
The board has approved ₹4,960 crore for land and preparatory work. The total project cost is estimated at approximately ₹35,000 crore, to be cleared in phases.
Q4: What is Maruti Suzuki’s current production capacity as of 2026?
MSIL has an installed capacity of 2.4 million units, but with the integration of its Gujarat subsidiaries, it has the technical capability to produce 2.6 million units annually.
Q5: Why did the company choose Gujarat for this expansion?
Gujarat offers strategic logistical advantages for exports (proximity to Mundra/Pipavav ports) and strong existing supplier ecosystems.
Q6: How will this expansion be funded?
The company will use a combination of internal accruals (cash reserves) and external borrowings.
Q7: What is the total capacity target for the end of the decade?
Maruti Suzuki aims to reach a total domestic capacity of four million units by 2030–31.