Car manufacturers stress on first mile connectivity for rail transportation

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CHENNAI: The country’s first rail auto hub in Wallajabad could be a success only if the Railway board revives the 10-year-old proposal to construct a new line between Chennai and Sriperumbudur and a spur line linking the industrial hub of Irungattukotai, according to industry sources.

V Anand, senior general manager, sales logistics, Hyundai, said that transporting cars through rails was not commercially feasible for car manufacturers. The cost of road freight per car is Rs 1,000 for the 45 km-stretch from the Hyundai manufacturing plant to Chennai Port. However, transferring the car through rail would entail a cost of Rs 4,200 per car, which includes rail freight charges as well as loading and unloading charges, said Anand.

He says the need of the Government was to look at first mile connectivity from Irangattukotai or any other car or vehicle manufacturing plant, which could reduce the burden on manufacturers and make the state more industry friendly.

His statement comes as Hyundai transferred 227 motor cars to Chennai Port. While car manufacturers believe that the rail link could be handy in case of emergencies, they feel in the shorter distance of moving the car, freight through rail is not feasible.

Chennai Port Chairman P Raveendran agrees with the concern of the car manufacturers and wants both Railways as well as state government to look at the woes of manufacturers and come out with a solution to make transfer of auto cargo through rail a success.

The issue is the rail freight charges, handling charges and port charges which make the rail freight costlier for auto manufacturers. This is the reason as to why the Rail Auto hub launched in 2016, has failed to attract the major auto hubs of Oragadam, Sriperumbudur and Singa Perumal Kovil areas, housing the manufacturing facilities of Nissan, Hyundai, Ford, Daimler Chrysler and others.

“First Mile connectivity is the only hope to decongest roadways and ensure that the manufacturers profits don’t get burned out,” said Anand. But the issue would be to ensure whether such a thing would be feasible for Indian Railways also. If the government comes out with an investment plan, then the project could be a viable one, says Raveendran.Interestingly, on Sunday, Chennai Port shipped out 4,025 Hyundai cars, including the 227 cars which were transported through rail.

Factfile

Transferring a car through rail will cost the auto manufacturer Rs 4,200, while by road it costs Rs 1,000
Auto majors say until there is no first mile connectivity, auto majors will push for road to transport their cargo to ports


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