Suzuki strengthens its foothold in India by establishing a global R&D center

The president of Suzuki Motor Corp. announced on Sunday that the firm will establish a global research and development unit in India, boosting its presence in a country that is poised to become the Japanese automaker's electric vehicle (EV) center.

During a ceremony in Gandhinagar, western Gujarat state, Toshihiro Suzuki stated that the new firm, a wholly-owned subsidiary of Suzuki Japan, will enhance the automaker's R&D competitiveness and capabilities in India and other international markets.

"India has become one of Suzuki Group's most important markets," he said, adding that the company would continue to make substantial investments in the country.

Suzuki, which now manufactures internal combustion engine vehicles in India for its local affiliate Maruti Suzuki and for export, will start building electric vehicles at its Gujarat factory in 2025. In addition, it is establishing a separate facility in the state to manufacture batteries for electric vehicles beginning in 2026.

It is one of Suzuki's major investments in batteries and electric vehicles. 650 billion rupees have already been invested in the nation.

"India plays a crucial role as the global production hub for the Suzuki Group," Suzuki noted.

In addition, Suzuki has a joint venture with Japan's Denso Corp and Toshiba (OTC:TOSYY) Corp to produce lithium-ion batteries for hybrid vehicles for export and local use.

Suzuki owns the majority of Maruti, whose small, affordable vehicles dominate the Indian automobile market. However, the company faces increased competition as buyers shift to larger vehicles such as sport-utility vehicles (SUVs) and regulators need safer and more environmentally friendly automobiles, resulting in higher expenses.

India is also providing automakers with billions of dollars in incentives to produce more electric automobiles.

Prime Minister Narendra Modi of India remarked that EVs are launching "a stealth revolution in the country" and that his government is trying to enhance the demand and supply of these eco-friendly vehicles.

Sunday's ceremony highlighted Suzuki's 40-year partnership with Maruti. During his speech, he stated, "This silent revolution will result in massive transformations."

Modi laid the cornerstones for two major projects: an electric car battery production facility for Suzuki in Gujarat and an automobile manufacturing facility for Maruti in the northern Indian state of Haryana.

Maruti regards electrification as a challenge since it wants New Delhi to reward all cleaner technologies, including as hybrid and ethanol, and not only EVs, which it does not expect to launch until 2025.