October 29th, 2011
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Maruti to open new plant in Gujarat

maruthiNew Delhi: Maruti Suzuki, India’s top carmaker, posted a wider-than-expected 60 per cent fall in its quarterly profit, hit by a labour unrest and rising interest rates and vehicle costs that have hurt demand in Asia’s third-largest economy. Maruti, 54.2-per cent owned by Japan’s Suzuki Motor Corp, said last week it had resolved the labour unrest at its plant in north India that had crippled production and sent sales tumbling.

Maruti said on Saturday net profit in its fiscal second quarter that ended on Sept. 30 dropped to 2.40 billion rupees ($49 million) from 5.98 billion rupees reported in the same period a year ago. Auto giant Maruti today, announced a Q2 profit at Rs. 240 crore in its second quarter results, down 59.8 per cent. The Maruti board has also approved a big plan to set up an additional manufacturing facility in Gujarat.

The state government is said to have earmarked 500 acres of land in Mehsana District, Gujarat, for the project. Maruti has said that along with vendors, it could invest up to Re 18,000 crore in Gujarat as it looks to produce around 2 million or 20 lakh units in the long run. Maruti Suzuki India is looking at a phased manner of starting car production in the state.

It proposes to invest around Rs. 4,000 crore in the first phase of the plant. For the last few months, consultations have been held between the Gujarat government and Maruti officials. Suzuki Motor Corporation chairman Osamu Suzuki and Maruti chairman R C Bhargava met chief minister Narendra Modi last month to discuss the proposed plant. The company had explored other states too, over the last four months.

 



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