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Suzuki Motorcycle India (SMIPL) is no longer looking at South India for its second manufacturing plant, and will remain in the North for the upcoming facility, a top official said.

The company was considering either Andhra Pradesh or Telangana for setting up the new plant last year, but with suppliers reluctant to go there, SMIPL has decided to remain in North India.

The 100 per cent subsidiary of Suzuki Motor Corporation, Japan, has a plant in Gurugram (Haryana).

“We are looking at various options…we are looking at one which is closer to the existing plant – could be in Haryana only, Rajasthan or Uttar Pradesh – one of these places,” Sajeev Rajasekharan, Executive Vice-President - Sales and Marketing, SMIPL, told BusinessLine.

He said consulting firm KPMG is doing a study on selecting the area, and soon it should be able to finalise the place. KPMG had done studies around south last year, which lasted till recent months, but did not give a ideal picture for setting up a plant there.

Rajasekharan said States such as Andhra Pradesh and Telangana are very proactive in welcoming business centres, but as a company, it has to look at various other reasons.

“For us, it not only depends on ease of doing business, but other things also...in terms of proximity to the current plant, availability of our suppliers – we need to be close by. We need to manage with the existing suppliers giving more quantity,” he said.

He said the company has to decide the location of the new plant by the end of this year as the existing facility only has a maximum capacity of 10-lakh units per year.

In Novermber, Satoshi Uchida, Managing Director, SMIPL, had said that “our target is to sell one-million units by 2020. Up to one-million we can use the existing plant [at Gurugram], but beyond that we have to consider a new plant. We expect to take a decision on it by next year”.

He had also added that “from the market point of view, South India is our biggest, so in terms of proximity to market, south is a good option, but then from the operational point, if we have two plants next to each other in Haryana, it will be a lot easier to manage”.

New launches

The company plans to launch an electric scooter by 2020 from the new plant, said Rajasekharan.

SMIPL manufactured around five-lakh units last year, and plans to manufacture around 7.70 lakh units this year at the Gurugram plant, eventually reaching up to 10-lakh units by 2020.

Apart from assembling the superbike Hayabusa at the plant, the company manufactures Access 125 scooter and motorcycles such as Gixxer, GSX-750 and Intruder 150.

https://www.thehindubusinessline.com/money-and-banking/suzuki-to-stick-to-n-india-for-its-second-two-wheeler-plant/article24427345.ece