Japan's Suzuki Motor said it plans to invest about 20 billion yen ($215 million) to build a new car factory in India, aiming to upgrade its production facilities in the face of growing competition.
Suzuki, which controls about half the Indian car market through unit Maruti Suzuki India Ltd, said late on Saturday that the new facility would come on-line as early as 2011 and have an annual output capacity of about 250,000 cars.
The plant will expand its existing Manesar facility in the state of Haryana, about 50 kilometres (30 miles) from New Dehli.
The investment will not alter Suzuki's annual production capacity of about 1 million cars in the country because it plans to shift about 250,000 units of capacity from its ageing Gurgaon facility to Manesar.
Suzuki Chairman Osamu Suzuki told a briefing on Saturday that the investment would likely come to about 20 billion yen, according to a public relations official.
Suzuki is bracing for tougher competition in the Indian market.
Tata Motors' Nano, the world's cheapest car, hit the roads in July. Toyota Motor Corp, Ford Motor Co, General Motors [GM.UL] and Volkswagen are all set to launch small cars in India next year.