Quick Takeaways
- India’s largest carmaker is unlocking a new growth lever by adding up to 1 million vehicles of fresh annual capacity in Gujarat.
- The Khoraj project removes production bottlenecks and positions Maruti Suzuki for export-led and domestic demand growth.
On January 12, 2026, Maruti Suzuki capacity expansion plans took a major step forward as Maruti Suzuki India Limited received board approval to acquire land at the Khoraj Industrial Estate from the Gujarat Industrial Development Corporation. The project supports Maruti Suzuki’s long-term manufacturing strategy as its existing vehicle production capacity is operating at full utilization.
The company currently operates manufacturing plants in Gurugram, Manesar, Kharkhoda, and Hansalpur with a combined installed capacity of around 2.4 million vehicles per year, while its maximum production capability reaches 2.6 million units annually. With this capacity now fully utilized, Maruti Suzuki has initiated the next phase of expansion to support rising domestic and export demand.
Maruti Suzuki capacity expansion to add up to 1 million units
The newly approved land acquisition at Khoraj Industrial Estate is designed to support a future production capacity addition of up to 1 million vehicles per year. This move is part of Maruti Suzuki’s strategy to strengthen its manufacturing footprint in Gujarat and ensure long-term scalability of operations.
The board has approved an investment of INR 49.6 billion for land acquisition, site development, and other preparatory activities linked to the project. The funding will be arranged through a mix of internal accruals and external borrowings, ensuring financial flexibility while executing this large-scale manufacturing expansion.
Investment and implementation framework
While the overall capacity addition is targeted at up to 1 million units, Maruti Suzuki will finalize the detailed timeline and total capital outlay as it defines different installation phases. The company’s board will review and approve each phase as the project moves forward, allowing a structured and demand-driven rollout.
Key elements of the approved plan include:
Maruti Suzuki capacity expansion driven by demand growth
The rationale behind the expansion is the sustained growth in vehicle demand in India and overseas markets. Maruti Suzuki continues to see strong traction in both domestic sales and exports, making additional capacity essential to avoid production constraints.
With its current plants already operating at peak utilization, the Khoraj project will provide the company with the flexibility to scale output, introduce new models, and strengthen its position as India’s largest passenger vehicle manufacturer while supporting its expanding export ambitions.
The company currently operates manufacturing plants in Gurugram, Manesar, Kharkhoda, and Hansalpur with a combined installed capacity of around 2.4 million vehicles per year, while its maximum production capability reaches 2.6 million units annually. With this capacity now fully utilized, Maruti Suzuki has initiated the next phase of expansion to support rising domestic and export demand.
Maruti Suzuki capacity expansion to add up to 1 million units
The newly approved land acquisition at Khoraj Industrial Estate is designed to support a future production capacity addition of up to 1 million vehicles per year. This move is part of Maruti Suzuki’s strategy to strengthen its manufacturing footprint in Gujarat and ensure long-term scalability of operations.
The board has approved an investment of INR 49.6 billion for land acquisition, site development, and other preparatory activities linked to the project. The funding will be arranged through a mix of internal accruals and external borrowings, ensuring financial flexibility while executing this large-scale manufacturing expansion.
Investment and implementation framework
While the overall capacity addition is targeted at up to 1 million units, Maruti Suzuki will finalize the detailed timeline and total capital outlay as it defines different installation phases. The company’s board will review and approve each phase as the project moves forward, allowing a structured and demand-driven rollout.
Key elements of the approved plan include:
- • Acquisition of industrial land at Khoraj Industrial Estate
- • Development of infrastructure and production-ready facilities
- • Phased installation of new manufacturing capacity
- • Financial structuring using internal and external funding
Maruti Suzuki capacity expansion driven by demand growth
The rationale behind the expansion is the sustained growth in vehicle demand in India and overseas markets. Maruti Suzuki continues to see strong traction in both domestic sales and exports, making additional capacity essential to avoid production constraints.
With its current plants already operating at peak utilization, the Khoraj project will provide the company with the flexibility to scale output, introduce new models, and strengthen its position as India’s largest passenger vehicle manufacturer while supporting its expanding export ambitions.
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