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Dedicated ports new craze in autoville

The Economic Times:  July 25, 2007

New Delhi: India's status as a global small car hub is prompting top car exporters to demand dedicated terminals at different ports. South Korean auto major, Hyundai Motor India (HMI), the largest exporter of passenger cars, is coming up with a ‘first of its kind’ dedicated automobile terminal at the Chennai port.

Similar to its Ulsan Port, from where it exports half of Korea’s 1,500,000 vehicles annually, the export terminal at the Chennai port would cater to its total export target of 300,000 cars—50% of its total production,by 2009-10.

“We are seriously considering the idea for developing the land into a dedicated terminal to serve as an export base. We are yet to decide on the facility and the details of the terminal,” said a Hyundai India spokesperson.

The terminal would basically cater to its export of compact cars from India. HMI has already shifted its entire production of the Atos Prime (Santro in India), its most popular compact car, and Getz Prime, the premium hatchback to the Sriperumbudur, just outside the Chennai port. The new terminal would also meet the requirements of the yet to be launched 1.1 litre new car, code named Pa, which is expected to hit the domestic and Europe markets simultaneously in October this year.

The new terminal would be spread over 10,000 square metre of land. It would have a six-storey multi-level dedicated parking yard for 6,000 cars. Chennai Port Trust chairman K Suresh told ET: “We are allocating them the required 10,000 square metre land, which would come up as the country’s first dedicated automobile terminal at Chennai. The facility would also be allowed to meet the demand of other car makers in the future.

According to industry sources, the Mahindra-Renault-Nissan combine, which is putting up a 400,000 unit greenfield plant in Chennai, will utilise Hyundai’s dedicated terminal for exports. As would Ford India, which is ramping up its Maraimalainagar plant to 100,000 units per year, 50% of which will be used for export.

Other automakers, like the Haryana based Maruti Udyog has also asked for an exclusive automobile terminal at the strategic Mumbai Port Trust to meet its export commitments. The company aims to export 200,000 units in the next three years. It has also asked for a dedicated freight Delhi-Mumbai corridor for seamless exports from its twin Manesar-Gurgaon plants in Haryana.

According to the Society of Indian Automobile Manufacturers (SIAM), automobile exports are expected to hit the 4,000,000 unit mark by 2015, of which 1,000,000 units would come from the passenger car segment. “There are several bottlenecks for exports. The city ports of Mumbai and Chennai allow car carrying trailers to move only during the night.

Both these ports lack proper road connectivity leading to loss of time and value for manufacturers. “With exports set to grow exponentially we have asked for streamlining of these facilities at the earliest,” SIAM director general, Dilip Chenoy said. Both these ports currently handle exports of around 225,000 vehicles annually. SIAM has asked the government to develop at least a 500,000 vehicle handling capacity each at both Mumbai and Chennai ports.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.