The Gujarat government is has set the ball rolling on developing a Japanese industrial cluster near the Maruti Suzuki India Ltd (MSIL) factory at Hansalpur.

Already, the area has managed to attract projects from leading Japanese companies like Honda Motorcycle and Scooter India (HMSI), a subsidiary of Mitsubishi Aluminium company, around four medium sized engineering companies from Japan, apart from the MSIL plant, which is to be built by a wholly owned subsidiary of its Japanese parent Suzuki Motor Corporation.

Shares of Maruti Suzuki India rallied 1 percent intraday on Monday. The car manufacturer which agreed to let parent Suzuki Motor Corporation own an upcoming plant in Gujarat, expects to save about Rs 10,500 crore in the first 15 years by not investing in the facility.

In a presentation filed to the BSE related to the contentious Gujarat plant, the company said it proposes to enter into a contract manufacturing agreement (CMA) with Suzuki Motor Gujarat (SMG), a fully owned subsidiary of Suzuki Motor Corporation (SMC).

MUMBAI: Automobile makers in India have lined up more than Rs 10,000 crore of investment to develop new passenger vehicles and soup up existing ones despite a slowdown in sales, as they strive to meet changing customer demands in a market where products become outdated fast, according to industry executives.

Companies such as Mahindra & Mahindra, Tata Motors, Maruti SuzukiBSE 0.56 % as well as the local units of Hyundai Motor, Renault and Nissan Motor are working on all-new platforms to bring out new products.

Mumbai: Car makers including Honda Cars India Ltd and Hyundai Motor India Ltd are tweaking the looks and features of existing vehicles in their line-up more frequently to attract young customers put off by ageing models.

In the past six months, Honda has launched the All New City, and Hyundai the new Elantra.

Car buyers are flocking again to showrooms, marking a steady increase in enquiry and booking levels in the past three weeks.

This reverses the weak consumer sentiment in the sector over the past 24 months. Dealers of cars and utility vehicles say buyers appear more confident in committing for a purchase than before the new government was formed at the Centre.

R C Bhargava, chairman of Maruti Suzuki India Ltd (MSIL), on Wednesday met Gujarat Chief Minister Anandiben Patel and discussed issues related to the company’s proposed manufacturing plant in the state.

Speaking to Business Standard, Bhargava said, “I had a meeting with the chief minister and the state finance minister (Saurabh Patel).

Maruti Suzuki is looking at an aggressive ramp-up of its dealership presence in the country to meet its target of selling over 2 million cars by 2017. The company plans to double dealer outlets in the next three years from 1,331 at present.

“From the dealership perspective, we focus on how close can we go to our customers. We are looking to double the dealership presence by 2017 to increase our reach,” said Mayank Pareek, chief operating officer (marketing & sales).

The new government seems to have spurred recovery in the automobile industry, with eight of the country's leading passenger vehicle makers on Monday reporting sales growth of 7.4 per cent in May.

These automobile manufacturers sold 190,193 vehicles in May, compared with 177,168 in the same month a year ago. According to data available with the Society of Indian Automobile Manufacturers (SIAM), domestic passenger vehicle sales had in April declined 9.50 per cent to 188,541 on a year-on-year basis.

NEW DELHI: Country's largest car-maker Maruti Suzuki India (MSI) today reported 19.2 per cent rise in total sales in May to 1,00,925 units as against 84,677 units in the same month last year.

The company said its domestic sales rose 16.4 per cent during the month to 90,560 units as against 77,821 units in May 2013.

Maruti Suzuki India’s (MSIL’s) proposed factory in Gujarat is faced with a technical hurdle.

In the process of reworking the state support agreement (SSA), thanks to the new scheme proposed by MSIL, the state government is learnt to have objected to offering value added tax (VAT)-related concessions twice, once to the manufacturer and then again to the seller. MSIL has been asked to suggest a new formula.

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