The Japanese auto major will be investing Rs 2.82 lakh crore till the end of decade, with 50 percent aimed at carbon neutral technologies.
26 Jan 2023 | 10580 Views | By Ketan Thakkar
Suzuki Motor Corporation, the small car specialist has committed to an investment of 4.5 trillion yen or Rs 2.82 lakh crore till the end of the decade with an aim of doubling its turnover to Rs 4.39 lakh crore and contribute towards a carbon neutral future.
In a strategy ...
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Suzuki Motor Corporation, the small car specialist has committed to an investment of 4.5 trillion yen or Rs 2.82 lakh crore till the end of the decade with an aim of doubling its turnover to Rs 4.39 lakh crore and contribute towards a carbon neutral future.
In a strategy document shared with the shareholders on Jan 26, the parent of India’s largest car maker expects internal combustion engines to account for 60 percent of the domestic market by the end of the decade. To participate in the growing electrification space, Suzuki Motors plans to have a portfolio of half a dozen models in the country by FY30.
The company forecasts 25 percent of its total sales to come from hybrid electric vehicles by 2030, almost 10 percentage points higher than the 15 percent share from zero emission battery electric vehicles. This was revealed in a presentation made by the company which was released on the stock exchanges today.
“In India, we will introduce the SUV battery EV announced at the Auto Expo 2023 in FY24, with six models to be launched by FY30. To provide a full range of products and services, Suzuki will provide not only battery EVs but also carbon neutral internal combustion engine vehicles that use CNG, biogas, and ethanol mixed fuels,” said Suzuki Motor Corporation.
Suzuki expects India and Africa to be amongst the fastest growing regions. It forecasts the Indian economy to grow from 1.6 trillion at present to 13.5 trillion by 2050.
“Of the 4.5 trillion Yen, two trillion Yen will be electrification-related investments, of which 500 billion Yen will be battery-related investments. Two trillion Yen is planned to be invested for research and development (R&D) expenses in areas including carbon neutrality such as electrification and biogas. 2.5 trillion Yen is planned to be invested for capital expenditures in facilities including construction of BEV battery plant and renewable energy facilities,” the company said.
The consolidated net sales which is forecasted at 4.5 trillion Yen for FY22 is expected to exceed the 4.8 trillion Yen target for FY25 set in the mid-term management plan, this it would like to grow to seven trillion Yen FY30, the elaborated the strategy document.
As per the mid-term strategic plan – called Growth Strategy for FY30 – Suzuki Motor Corporation’s motto is to deliver “value-packed products” by focusing on the customer, Suzuki will carry out its unique Growth Strategy for FY30 by operating under the principle of manufacturing “Sho-Sho-Kei-Tan-Bi (Smaller, Fewer, Lighter, Shorter, Beauty)”, “Lean Management” which emphasises flexibility, agility and the challenging spirit and the “Three Actuals” principle, which omits impracticality and focuses on the actual place, thing and situation, in a strategy statement released on Jan 26.
“Suzuki will contribute to the realisation of a carbon neutral society and the economic growth of emerging countries such as India, ASEAN, and Africa, with our main business regions, Japan, India, and Europe, as the core. We will focus on creating solutions that are unique to Suzuki, which are to develop products and services focused on the customer, and grow along with the operating countries and regions,” added the statement.
Based on the target date set by each government, Suzuki aims to achieve carbon neutrality in Japan and Europe by 2050 and in India by 2070.
The EVs in Japan will start with the introduction of commercial mini-vehicle battery EVs in FY23 and it plans to introduce compact SUVs and passenger mini vehicles, with six models to be launched by FY30. In addition, Suzuki will develop new hybrids for mini and compact vehicles and by combining them with battery EVs, they will offer various options for its customers, claimed the company highlighting the increasing role of Hybrids.
The company will also be introducing eight new electric vehicles for the two-wheeler segment catering to the varied requirement of transportation such as commuting to work, school or shopping,
“We will introduce a battery EV in FY24. We plan to launch eight models by FY30 with a battery EV ratio of 25 percent. For large motorcycles for leisure purposes,” added Suzuki Motor.
It has set itself a challenge to achieve carbon neutrality of domestic plants by FY35.
The Japanese auto major asserts that while the Indian market will continue to grow till FY30, it admits that an increase in total CO2 emission amount is unavoidable, regardless of reduction in CO2 emission from products.
“We will challenge to strike a balance between increasing sales units and reducing total CO2 emission amount. Suzuki’s unique initiative to tackle this challenge is the biogas business, in which biogas derived from cow dung, which are dairy wastes that can be seen mainly in India’s rural area, will be produced and supplied,” explained Suzuki Motor.
This biogas can be used for Suzuki’s CNG models that account for approximately 70 percent of the CNG car market in India. Suzuki signed an MoU with the Indian government agency National Dairy Development Board and Banas Dairy, Asia’s largest dairy manufacturer, to conduct verification of biogas.
“We believe that the biogas business in India not only contributes to carbon neutrality, but also promotes economic growth and contributes to the society of India. We are also in view of expanding the business to other farming areas in regions including Africa, ASEAN, and Japan in the future,” claimed the company.
The company said it will deepen its cooperation with Toyota Motor Corporation while continuing to be a competitor and aim for sustainable growth and conquer various issues surrounding the automobile industry.