Hyundai finds rail route to Chennai Port unviable

Hyundai Motor India Ltd., (HMIL) has dropped a proposal to transport cars by railway rake to Chennai Port for onward export.

The carmaker dropped the proposal after finding it to be commercially unviable.

When the company sent its consignment by rake to Chennai Port for the first time on December 1, it was considered as an alternative mode of transport that would decongest roads and reduce carbon emissions.

“Last week, we moved about 227 cars through rake from Sriperumbudur to Walajabad rail-auto hub and Tiruvallur, thinking it was the easiest way to move cars,” said V. Anand, senior general manager, sales logistics, Hyundai Motor. “Though it was technically feasible, it is not so commercially. Hence, we are going back to moving cars through trailers,” he added.

Mr. Anand said it cost 346% more to move cars through rake. HMIL had to shell out additionally ₹4,280 per car that included rail freight, loading and unloading charges of ₹2,780, port haulage charges of ₹580 and service provider charges.

HMIL exports about 10,000 to 12,000 cars a month through the Chennai Port.

The vehicles are moved from its Sriperumbudur facility, which is located about 40 km from the city, to the port through trailers. It takes two hours maximum by road to reach the Chennai Port.

Transporting it through rake, however, took almost a day.

Mr. Anand said that the need of the hour was to provide first-mile connectivity to car manufacturers located in and around Oragadam, Singaperumal Koil and Sriperumbudur, so as to make the rail-auto hub commercially viable.

The distance between Chennai Port and Walajabad auto hub is 70 km and the distance between Tiruvallur rail-auto hub and Chennai Port is 40 km.

HMIL is, perhaps, the only car company to use Chennai Port for export. Ford, Nissan and Toyota use Kamarajar Port.

Ford managing director Anurag Mehrotra had recently indicated the company was open to the idea of moving cars by rail to port.

Kamarajar Port Chairman P. Raveendran, in the meanwhile, said that the port was in advanced talks with auto majors to move cars and trucks through rake.