Gujarat’s Automotive Evolution: From Zero to a $3 Billion Hub

Gandhinagar: Gujarat’s automobile sector is valued at USD 3 billion.

With an annual export of over 8 lakh vehicles, Gujarat has proven itself as a vital contributor to India’s automotive landscape. The state’s journey towards becoming an automotive hub began with the establishment of the Tata Motors manufacturing plant in Sanand in 2009, acting as a magnet for both domestic and international players.

The evolution of Gujarat’s Automobile Sector is closely tied to the Vibrant Gujarat Global Summit (VGGS), initiated in 2003 by the then Chief Minister, Shri Narendra Modi, now the Prime Minister. This summit has been instrumental in reshaping the state’s socio-economic landscape, making it a preferred destination for investment and innovation.

The 10th edition of the Vibrant Gujarat Global Summit, scheduled for January 2024 and led by Hon’ble Chief Minister Shri Bhupendra Patel, will further solidify Gujarat’s position as an unrivaled hub for investment and innovation.

Gujarat’s automobile industry success stories include Ford Motors’ INR 5,000 Crore investment in their Sanand plant in 2011, generating 3,000 jobs, and Suzuki Motors’ INR 14,784 crore mega unit in 2014, creating 9,100 jobs. In 2022, Tata Motors acquired the Ford plant in Sanand. Additionally, Gujarat’s collaboration with JETRO has resulted in India’s first plug-and-play park, the Japanese Industrial Park. In 2017, MG Motors acquired GM India’s Halol Plant with an initial investment of ₹2000 crores and a production capacity of 80,000 units per annum. It is important to note here that this is MG’s only manufacturing facility in India.

The Mandal-Becharaji Special Investment Region (MBSIR), boasting $3 billion in investments, stands as a pivotal automotive manufacturing hub hosting major players such as Maruti Suzuki, and Honda. It boasts a combined annual production capacity of over 1 million vehicles. In addition, The International Automobile Center of Excellence (iACE) stands as a testament to the collaboration between the Government of Gujarat and Maruti Suzuki India Limited. This pioneering joint venture signifies a significant milestone in the automotive industry. iACE, located in Gujarat, serves as a state-of-the-art facility dedicated to research, development, and innovation in the automobile sector. It acts as a hub for cutting-edge technology, fostering a conducive environment for automotive advancements. With its commitment to excellence, iACE aims to propel the industry forward, driving innovation, sustainability, and skill development, ultimately contributing to the growth and competitiveness of the Indian automotive landscape on the global stage.

Furthermore, Gujarat has become a significant exporter of automobiles and auto components, with over 8 lakh (800,000) vehicles exported in the fiscal year 2020-21.

In keeping with the global shift towards electric mobility, Gujarat is actively promoting electric vehicle (EV) manufacturing. The State Government has signed a momentous MoU with the Tata Group, worth ₹13,000 crores, to establish an EV battery plant. This aligns seamlessly with India’s commitment to sustainable mobility and further positions Gujarat as a leading hub for EV manufacturing.

Gujarat’s journey from obscurity in the automobile industry to becoming a USD 3 billion automotive powerhouse is a remarkable testament to visionary leadership, a business-friendly environment, and strategic collaborations. As Gujarat gears up for the 10th Vibrant Gujarat Global Summit in 2024, it is evident that the state’s trajectory of growth and innovation in the automotive sector will continue to rise.