Maruti Suzuki India (MSI), the country's largest carmaker, announced that its board of directors has given in-principle approval for the new factory, which is planned to open in stages depending on market conditions.

Maruti Suzuki Chairman RC Bhargava said in a virtual news conference following the Q4 results that the new facility would be in addition to the company's forthcoming manufacturing plant in Sonipat, Haryana.

He stated that the new facility would be built concurrently with the Sonipat plant.

MSI is investing 11,000 crore on the first phase of the Sonipat factory, which would have an initial manufacturing capacity of 2.5 lakh units per year and is scheduled to open in 2025.

"We along with Suzuki looked at the estimated demand scenario over the next 8 years..it is expected that the Kharkhoda plant (in Sonipat) capacity will be fully utilised..so we decided to put up one million additional capacity," Bhargava said.

When asked about the estimated investment in the new factory, Bhargava said it was still being finalised but that it could be slightly greater than the Sonipat facility.

MSI's total existing production capacity in Manesar and Gurugram is around 15 lakh units per year. It is also the sole beneficiary of Suzuki Motor Gujarat's (SMG) 7.5 lakh unit capacity under a contract manufacturing deal.

It would also receive 10 lakh capacity from the Sonipat facility.

"The models would largely be in the SUV category," he explained.

"We crossed the 1 lakh crore turnover milestone last fiscal despite so many challenges," Bhargava added.

He stated that the industry is likely to increase 5-7 percent in the current fiscal year, and that the company hoped to grow faster.