Suzuki to set up 2nd factory in Rohtak

Two-wheeler maker Suzuki Motorcycle India Private Limited (SMIPL) on Monday laid the foundation stone for its second manufacturing facility in the country at Rohtak in Haryana.

The company has a capacity to produce 470,000 units at its first factory in Manesar, Haryana. SMIPL declined to specify the investment it was making for establishing the new unit. Industry sources, however, indicated investments to the tune of Rs 2,000 crore were scheduled for Rohtak.

This would be inclusive of the resources being utilised by Maruti Suzuki to set up a research & development facility in Haryana.

SMIPL has limited presence in the motorcycle industry in India with GS150R (150 cc) and Slingshot (125 cc). Over 80 per cent of its volumes, 288,604 units, came from scooters, Access 125 and Swish 125, in the last financial year. Motorcycle sales stood at a modest 50,130 units.

Suzuki is gearing up to foray into the fast-growing mass commuter segment with Hayate next month. The 110-cc Hayate will take on best-sellers Hero Splendor, Bajaj Discover and TVS Star City. Suzuki is expecting to sell 10,000 units of Hayate every month after the launch, double the 5,000 units its best-seller Slingshot clocks in month at present.

With sales of over seven million units, the commuter segment contributes as much as 70 per cent of overall motorcycle sales in the country. Hero alone accounts for three-fourths of sales in the category. Suzuki, which has products with engine capacity upwards of 125 cc, has less than one per cent share in the domestic motorcycle market.

To tap growth potential in the hinterland, Suzuki, too, has commenced work to double its distribution network to 500 touch points over the next two years. To meet growing requirement the company is increasing capacity by 50 per cent to 540,000 units by 2014.