[GTO]

High Points:

- Remember the rumour?. It's official now. The Maruti Board has approved the setting up of factories in Mehsana, Gujarat.

- Intended capacity is 20 lakh cars (split over 2 phases). The total investment will be Rs. 18,000 crores (which includes 6,000 crore from vendors).

- Tata, Ford, GM, Peugeot and now Maruti will have factories in Gujarat. Hats off to Modi for attracting such huge investments! It might be recollected that Osamu Suzuki met with Narendra Modi earlier this year; he obviously liked what was presented to him. They say there is no salesman like Modi.

- Gujarat has an extremely industry-friendly environment, a no-nonsense CEO in Modi, rolls out the red carpet to newcomers and also offers a port for exports.

Other Related News:

- Maruti's Q2 net profits fell 60%. Primary reason = Labour troubles at Manesar.

- Fiat's Ranjangaon facility should start supplying engines to Maruti in early 2012.

[MAS]

That is great news. Gujarat is fast becoming the Detroit of India.

[hellmet]

Last I heard Chennai was to be the Detroit of India, or did it already become the Detroit (post-2008) of India?

I'm sure Maruti will want to dismantle their existing plant if possible and move totally out of Haryana after their never-ending labour unrest. Good for Gujarat!

[bluevolt]

This is very good news especially when we see long waiting period of Maruti diesel cars. More production = less waiting period.

Will Maruti leave Haryana read Gurgaon and Manesar in near future?

[anupam00]

Modi is great when it comes to industries.

If BJP bets on Modi as PM Candidate than that would yield more results.

Good for Gujarat & Bad of Haryana.

Overall - we all would acknowledge it would bring great focuss & employement oppurtunities for Guj.

Thanks & Regards
Anupam

[swiftnfurious]

That's pretty good investment & production capacity. Currently under normal production, I guess Maruti produces around 12L cars? This should make sure that the waiting periods are brought down substantially. Do they intend to move out of Haryana completely?? Or will they have it also running with an additional [current] capacity of 12L or so ??

[piyushrm]

Just not that, that can take advantages of the ports in Guj. to ship there products, good strategy and risk mitigation for Maruti.

[kaks15]

Guess a new book might be revealed soon

"From Gujars to Gujarat : How we conquered Indian market" by Osamu Suzuki

A good move till modi is there , and as pointed out Gujarat has its advantages.

The violent streak at gurgaon is pushing away things; from metallica to maruti!!

Authorities must wake up from their slumber and put a controlling lid on situation or the NCR Manhattan will soon be left with nothing and we will have to move to other cities for jobs. WAKE UP HARYANA GOVERNMENT

[HammerHead]

Originally Posted by GTO

- Gujarat has an extremely industry-friendly environment, a no-nonsense CEO in Modi, rolls out the red carpet to newcomers and also offers a port for exports.

Indeed and is quiet evident if one looks at the amount of business he was able to pulled towards Gujarat.

- Fiat's Ranjangaon facility should start supplying engines to Maruti in early 2012.

Does that mean there will be less waiting time on Swift DDiS?

Is MS moving the whole setup to Gujarat?

[sgiitk]

Look at this another way. A big boy like Maruti will definitely like not to place all its eggs in the same basket. If they decide to move out then the natural options will be TN and Gujarat. So it is now coming to pass. Also, they are in serious discussions with FIAT for engines, so one major ancillary will no longer be needed.

[ZeRo©]

This is a great business decision which would have been taken even if it was all well in Gurgaon.

The company which I work for(Adani Logistics Ltd.) has an MOU with Maruti-Suzuki for exports, currently cars are stuffed into containers and sent from our ICD(container depot) in gurgaon, which is then sent to Adani's port in Mundra and then loaded in ships for export.
Now, if Maruti expands in Gujarat then it will be beneficial for both the companies. Adani's get exclusive export rights, as Adani's are known to be very close to Modi and might have played some part in the deal.

As for Haryana Govt. this is what the Haryana Minister Mr Surjewala had to say when asked if they were worried that maruti might move out of Haryana.

Q: How worried are you about Narendra Modi and Gujarat because they are trying to get all of the business that is currently in Haryana to move to Gujarat?

A: Not at all. Maruti is going there as a part of their own business plan to export cars. They are next to a port which is fair. I am nobody to decide upon Maruti’s business plan. But they are also making investment of Rs 10,000 crore in Haryana. Having said that some of the auto manufacturers also came to Haryana and we took a call to send them back to Gujarat. There was a reason for it.

Here is a state which gives land at rupee per acre, waives value added tax which is the principle main stay of running your state for 25 years. It waives all registration and local municipal taxes. What does the state of Gujarat gain? I asked that question to myself and I could not answer that. I am sure Modi would have an answer to that. At least the state of Haryana could not offer the kind of incentives.

Land is an extremely precious commodity. I run my state on Rs 8,000 crore of VAT that accrue to me. I run my state from the registration charges and local municipal corporation taxes. We cannot possible waive everything in our quest to build an individuals leadership.

Now the minister misses the point that how much employment this will create in Gujarat and strengthen Gujarat's positions for a more favored business destination. The Gujarat govt. can recover the cost in future.

Now only if ford, TATA, Peugeot's are ready to sign some more export and domestic MOU's.

[SwiftSD]

Great News, it is surely a good move. It is always better to have your units in different geographic locations so that Manesar like episodes do not have a brobdingnagian impact on the production capacity.

[SunilM]

I was wondering what prompted Maruti to select a comparatively backward region like Becharaji when the state government was pushing for the new auto hub at Sanand (a suburb of Ahmedabad) ? Sure they can get very cheap labor and cheaper land at Becharaji, but there may be other challenges in choosing a comparatively backward location. I am sure a company like Suzuki would have done their homework, but can't justify the choice. Contrary to news elsewhere, Govt of Gujarat says Maruti will have to buy the land on their own - with government only facilitating the speedy acquisition. They sure will get a bunch of tax waivers.

Either ways a great news for Gujarat. It will trigger a massive development in that area surrounding the mother plant and ancillary units.

[chennai-indian]

Most politicians except ones like Modi just do not realize what a boon a new auto plant can be for a region. The Haryana minister quoted earlier must realize that it is not just the direct revenue that is important. What is more important is the economic effect that the plant brings to the whole region.

[Gandhi]

Kudos to Modi for pulling this one off.

Originally Posted by SunilM

I was wondering what prompted Maruti to select a comparatively backward region like Becharaji when the state government was pushing for the new auto hub at Sanand (a suburb of Ahmedabad) ?

I'm also wondering the same. I think the Modi government wants to make Dholera and Sanand the region for industries. But this move surely didn't work out on that front.