Maruti Suzuki sets aside Rs 5,000 crore in capital expenditure for FY22

“Capex of Rs 5,000 crore is something that we’ve committed for this fiscal on various projects, including, the new model launches etc,” MSI CFO Ajay Seth said in an analyst call.

According to a senior company executive, Maruti Suzuki India (MSI) has set aside Rs 5,000 crore in capital expenditure for different projects, including new product launches, for the current financial year. Suzuki Motor Corp’s investment in Gujarat, according to the country’s top carmaker, would help it extend its battery electric vehicle (BEV) line in the country.

“Capex of Rs 5,000 crore is something that we’ve committed for this fiscal on various projects, including, the new model launches etc,” Maruti Suzuki CFO Ajay Seth said in an analyst call.

Maruti Suzuki sets aside Rs 5,000 crore

He stated that the maker of Alto and Swift would limit capex through internal accruals.

“This investment will greatly support in localising EV manufacturing and help the company to accelerate and expand its BEV product portfolio in India,” Seth said in response to a question about Suzuki’s plans to invest in Gujarat for local manufacturing of Battery Electric Vehicles (BEV) and BEV batteries.

By 2025, the company plans to launch its first BEV.

Suzuki Motor Corporation said in March that by 2026, it will invest over 150 billion yen (around Rs 10,445 crore) in Gujarat for local manufacturing of Battery Electric Vehicles (BEVs) and BEV batteries.

Seth responded to a question about the current semiconductor shortage. And its influence on the company. By saying that the supply situation for electronic components remains unpredictably unstable.

“It might have some impact on the production volumes for FY 2022-23 as well,” he added.

Due to production challenges caused by a severe shortage of chips, MSI now has a backlog of over 3.2 lakh units.

“Generally chips will continue to be a challenge in this year also and of course we’ll try to maximise our numbers,” MSI Executive Director Corporate Affairs Rahul Bharti said.

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In response to a question on hybrids. He said the technology is quite powerful. And can be used in conjunction with EVs to help cut carbon emissions and oil imports.

“They do about 30-40 per cent of the job of an EV and are many times more scalable. It would be an interesting option and we’ll be looking forward to such technologies in the future,” Bharti said.

He stated that the company would like to reclaim more than 50% of the domestic passenger vehicle market.

“Of course, as a market leader our target will be to be at 50 per cent market share or more. There are a number of factors responsible for this. One the semiconductor shortage, with the three lakh pending orders if we service that. Then the numbers and market share would be much higher”. Bharti stated.

He stated that the corporation has a market share of over 65 percent in the non-SUV segment.

“In every segment other than SUV our market share has gone up. Whenever we launch SUVs, of course, the market share has to improve,” Bharti said.

To consolidate its position in the fast-growing SUV market, the corporation wants to offer additional vehicles.

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