Update: Suzuki not to raise production in India says Osamu Suzuki

Briefing the press on its Indian operation at the company headquarters in Hamamatsu, central Japan today, Suzuki's chairman Osamu Suzuki said that the company will be building a new plant in India although it would not increase production in the country.

He also said that investment in the new plant to be located at Manesar in Haryana, where it already has an existing facility, would not be 30 billion yen as reported by the media but a lot less although he did not specify the new investment.

The Japanese Nikkei business daily reported today that Suzuki Motor plans to build a new factory in India in 2011 at a cost of around Rs1,570 crore (30 billion yen) in order to increase production capacity by 30 per cent.

Japan's Suzuki Motor Corp, which started was a minority joint venture with the Indian government as Maruti Udyog Ltd, now operates as Maruti Suzuki India Ltd, and has manufacturing facilities at Gurgaon and Manesar in Haryana.

Maruti Suzuki had said in July that it would increase its current annual production capacity of three lakh units at its Manesar plant in Haryana by another one lakh by the end of this fiscal, and raise production in the country to 10 lakh cars per annum.

Last month, Maruti Suzuki India Ltd said that it would invest more than Rs1,000 crore to build its first India-specific research and development centre, spread over 700 acres at Rohtak in Haryana. (See: Maruti to inaugurate new 700-acre R&D facility in Manesar)

A surge in vehicle sales saw Maruti Suzuki India reporting a near triple rise in exports on strong demand from Europe. Maruti Suzuki India sold a total of 84,808 vehicles in August 2009, growing 41.6 per cent in the month. This includes exports of 14,847 units, the highest ever monthly export in the company's history.

(Also see: Suzuki investing $323 million in new plant in India: report)