Maruti Suzuki India Limited’s Board of Directors has approved the acquisition of land at the Khoraj Industrial Estate in Gujarat to support a significant expansion of its manufacturing capacity, the company informed stock exchanges on January 12, 2026.
The automaker plans to add up to 1 million units of annual production capacity at the proposed facility, which will be developed on land acquired from the Gujarat Industrial Development Corporation (GIDC). The Board has approved an outlay of ₹4,960 crore towards land acquisition, development and preparatory activities for the project.
The decision comes amid capacity constraints across Maruti Suzuki’s existing manufacturing network, with its plants at Gurugram, Manesar, Kharkhoda and Hansalpur currently operating at peak utilization. With limited headroom to respond to rising market demand, the constraints have the potential to impact customer delivery timelines, necessitating the capacity addition.
At present, Maruti Suzuki operates with a total installed capacity of around 24 lakh units per annum, with the ability to produce up to 26 lakh units annually, including output from the erstwhile Suzuki Motor Gujarat Private Limited, which has since been merged with the company. According to the regulatory filing, this capacity is now fully utilised.
The company cited sustained growth in market demand, including exports, as the key rationale for the expansion. The proposed additional capacity of 1 million units is expected to provide much-needed operational flexibility for India’s largest passenger vehicle manufacturer.
Gujarat continues to strengthen its position as a strategic automotive manufacturing hub, offering proximity to major ports such as Mundra and Kandla, enabling efficient export logistics. Pro-business policies, robust industrial infrastructure and availability of skilled labour further enhance the state’s attractiveness. Maruti Suzuki already operates a large facility at Hansalpur, making Khoraj a natural extension of its manufacturing footprint.
The expansion also aligns with Maruti Suzuki’s efforts to scale up exports while meeting strong domestic demand. With India’s automobile exports gaining momentum, manufacturers are increasingly positioning the country as a global export base, particularly for markets in Africa, Latin America and Southeast Asia. The additional capacity will enhance Maruti Suzuki’s ability to cater to both domestic and international markets.
The new facility is expected to generate significant employment in Gujarat, both directly through manufacturing operations and indirectly across the automotive supply chain, including component suppliers and service providers.
The capacity expansion supports the Indian government’s Make in India initiative and aligns with policy measures such as the Production Linked Incentive (PLI) scheme for automobiles and auto components. Investments in new facilities are also being driven by the need to adopt advanced manufacturing technologies to meet evolving emission norms, electric vehicle adoption and changing consumer preferences.
Maruti Suzuki said the timeline for the proposed capacity addition and the total project investment will be finalised and approved by the Board while determining the phased installation plan. The project will be funded through a mix of internal accruals and external borrowings.
The move marks a significant milestone in Maruti Suzuki’s long-term growth strategy as it seeks to retain its leadership in India’s rapidly expanding automotive market while strengthening its global export capabilities.
