Maruti Suzuki Bets Big on Small Cars with $1.48 Billion Expansion

Maruti Suzuki India plans to invest $1.48 billion to expand its production capacity, reinforcing its focus on small cars in the growing Indian market. The company aims to increase output by 500,000 units in the current financial year, banking on strong demand for affordable vehicles despite global uncertainties.

Chairman R C Bhargava highlighted that small cars make up a significant portion of pending orders, underlining their importance in a price-sensitive market like India. The company’s strategy comes as vehicle demand improves following tax cuts, boosting showroom traffic and sales across entry-level and SUV segments.

However, rising raw material costs—partly driven by geopolitical tensions affecting supply chains—have impacted profitability. Quarterly profit fell below expectations, even as revenue and overall sales rose strongly. Despite these pressures, Maruti Suzuki remains optimistic about sustained demand and long-term growth in the domestic auto sector.

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