Maruti Suzuki eyes ₹1.25 tn capex to boost EV, SUV play

livemint.com:

₹1.25 trillion by 2030-31 to develop 10-11 new models, including six electric vehicles (EVs), and double its annual production to 4 million units. In a presentation, the country’s largest carmaker said it plans to dial up its presence in new vehicle segments, including hybrid, flex fuel and electric, particularly in the sport utility vehicle (SUV) format. The company said it expects EVs to make up 15-20% of its sales by 2030-31.

“Another 25% could be hybrids, and the rest would use ethanol, CNG (compressed natural gas) and possibly CBG (compressed biogas)," it said. In July, Maruti Suzuki said it would buy out its Japanese parent Suzuki Motor Corp.’s (SMC’s) stake in Suzuki Motor Gujarat (SMG), its contract manufacturer, by issuing preferential shares. On Monday, the company said this will help it conserve cash reserves.

“It took nearly 40 years for Maruti Suzuki to reach a scale of approximately 2 million units, and now it is looking to add another 2 million units in just 7-8 years. Of this volume of 4 million, over 3 million units are planned to be sold in the domestic market, including sales to other original equipment manufacturers (Toyota), and 750,000-800,000 units are expected to be exported. The domestic market is expected to grow at approximately 6% compound annual growth rate (CAGR) and is expected to be around 6 million units by 2030-31.

The company is expected to grow faster than the Industry," the presentation said. The carmakers hopes its SUV focus will help it regain its lost market share—52% at its peak in 2018-19—offsetting the decline in small car sales, which has been its core market. “Funds would be needed for creating the sales, service and spare parts infrastructure to almost double domestic sale