Even as it takes a measured approach toward entering the emerging electric vehicle space in the country, India’s largest car maker Maruti Suzuki has started localisation of cells and will be exporting lithium-ion batteries worth ₹1,500 crore a year to Europe in the next three years. A resolution on related party transactions in the FY22 annual report shows Maruti will export battery packs to Suzuki’s European subsidiary Magyar Suzuki and the amount will not exceed ₹1,500 crore in a financial year for the period beginning from FY23 to FY25. The peak value of export will be realised in the third year as the production progresses.
Rahul Bharti, the head of investor relations at Maruti Suzuki, said Maruti Suzuki is the first company in India to export lithium-ion batteries from cells made in India. “We will be purchasing these batteries from fellow subsidiary TDSG, Suzuki’s JV with Denso and Toshiba in Gujarat, for both in-house use and export to Europe,” he said. “Since both the purchase and the export come under the ambit of related party transactions, under the Sebi rules we have moved a resolution to seek minority shareholder approval. ”
This allows strong backward integration for Maruti Suzuki and enables it to keep the cost low and price accessible for its EVs when it enters the market in 2025. Immediately, these batteries will be used in hybrid vehicles that will hit the roads this fiscal year.
Maruti Suzuki has become the first company in India to produce made-in-India battery cells and is receiving encouraging orders for its export of battery packs. The batteries will be shipped mainly to Magyar Suzuki — the Hungary-based unit of Suzuki Motor, according to the company's disclosure on related party transactions.
To be sure, Maruti has already been exporting battery packs for the export market for the previous few months. The exported Li-Ion battery would be installed in e-hybrid vehicles produced by Magyar Suzuki. In 2021, Magyar Suzuki produced 107,874 units, of which two-thirds were hybrids, according to Magyar Suzuki’s website.