Maruti Suzuki bets big on alternative fuel with Rs 561 crore CBG push; flags rising input cost pressures

said on Friday is deepening its with plans to set up four () manufacturing projects, approving an investment of Rs 561 crore in the first phase even as higher weighed on its quarterly profitability.

The company’s board on Friday approved the four projects and said it would consider expanding based on the experience from the first phase.

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The move comes as automakers increasingly look beyond electric vehicles to alternative fuels such as CBG to support India’s transition to cleaner mobility. Chemically similar to compressed natural gas (CNG), CBG can be used in existing CNG vehicles and is being promoted by the government as a way to reduce crude oil imports, manage agricultural and municipal waste, and lower emissions.

The investment expands Maruti Suzuki’s push into compressed biogas, which can be used as a cleaner alternative to CNG and is being promoted by the government to reduce emissions and dependence on imported fossil fuels.

It builds on the early success of parent Suzuki Motor Corp.’s CBG project in Gujarat. Other automakers, including and , have also expanded their portfolios of CNG and LNG commercial vehicles, while partnering with fuel retailers to support the adoption of alternative fuels.

The announcement came alongside Maruti Suzuki’s first-quarter earnings, where the company said higher vehicle sales were enabled by the commissioning of its second manufacturing plant at Kharkhoda in Haryana, which helped increase production while keeping dealer inventory at around 13 days at the end of the quarter.

The automaker sold 682,700 vehicles during the April-June quarter, with total sales volume rising 29.3% year-on-year. Domestic sales of small cars grew 34.1%, SUV sales increased 44.6%, while exports rose 28.6%. The company’s domestic market share improved by 2.3 percentage points to 41.2%.

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Net sales rose 36% year-on-year to ₹49,959 crore during the quarter. However, net profit declined 11% to ₹3,352 crore from ₹3,758 crore a year earlier, as higher input costs eroded margins.

said raw material costs started increasing during the quarter and were “seriously aggravated during the war”, hurting profitability despite robust revenue growth. The company had earlier announced two rounds of price hikes this year to partially offset rising commodity costs, including steel and other key inputs.