Business » Industry

Updated: January 24, 2014 20:34 IST

Competition among ports on car exports

N. Anand
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Nissan cars, waiting to be loaded onto a ship, at Ennore Port in Chennai. A file photo: Bijoy Ghosh.
The Hindu Nissan cars, waiting to be loaded onto a ship, at Ennore Port in Chennai. A file photo: Bijoy Ghosh.

A different type of competition is brewing among Chennai Port Trust (ChPT) and Ennore Port Limited (EPL) in the car export/import front.

In the East coast, cars are exported through these ports with ChPT leading the way. Being a late entrant, EPL has started garnering the customers of ChPT. EPL recently concluded long-term leases with Nissan and Ford.

For the current year, EPL will export 2 lakh cars representing 10 per cent growth over the previous year. ChPT will handle 2.50 lakh cars this year against 2.72 lakh cars handled during 2012-13.

Right now, EPL has parking space for 10,000 cars and it would be enhanced to 13,000. On the other hand, ChPT provides parking space for 4,000 cars and it has drawn expansion plans to house another 6,000 cars.

While the officials of both the ports dismissed the development as a ‘healthy’ competition, Logistic operators and Custom House Agents describe it as a new development that would augur well for the trade. Car-makers have started eyeing EPL, ever since Chennai Port was caught in the traffic congestion woes.

The transition is happening, despite the fact it is costlier to export cars through EPL. While only a couple of car makers are using Ennore Port for availability of sufficient parking space and grace time, others are still using ChPT as the tariff is lower.

“Why fight over the current tariff rates. One has to think what would happen 10 years down the line. Will there be a significant increase in number of cars exported from these ports in the coming years considering the fluctuating situation in automobile sector?” asked a logistic operator.

Alternative cargoes

For the last two years, ChPT has been losing revenue of over Rs.220 crore due to a ban on handling coal and iron ore. Coal got shifted to Ennore Port. To offset the revenue loss, ChPT is planning to convert Bharati dock (that was handling iron ore) into a car terminal and Jawahar dock into a container terminal.

As per the proposal, ChPT will develop the car terminal at Bharati dock on 10 hectares costing Rs.30 crore. The terminal will be operated by a private party for 10 years. Tenders were floated recently.

“Of late, ChPT has been actively pursuing several projects. However, they are yet to materialise. Will they succeed in this venture?” asked a Custom House Agent.

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