Chennai rail auto hub to be big driver for industry: Car makers

The proposal to set up India's first rail auto hub in Chennai announced in Thursday's Railway Budget will provide a big support to the automobile industry, facilitating transportation of vehicles from manufacturing plants to respective destinations, say carmakers. Railway Minister Suresh Prabhu while presenting the budget for 2016-17 on Thursday in Parliament said, "To capture the automobile traffic, we will soon inaugurate India's first rail auto hub in Chennai." 

Reacting to the announcement, Hyundai Motor India Ltd Senior Vice-President (Sales & Marketing) Rakesh Srivastava told PTI, "Last mile connectivity, reduced logistic costs and time, (are) addressed in one big infrastructure move enabling mass transportation of vehicles with the Auto Hub at Chennai giving a big support to the auto industry."

Expressing similar views, Renault India Operations Country CEO and Managing Director Sumit Sawhney said India's first rail auto hub in Chennai will facilitate transportation of cars from manufacturing plants to respective destinations as the city is “a growing automobile hub and is being regarded as ‘Detroit of the East’”. Welcoming the proposal to develop rail side logistics parks and warehousing in PPP mode, he said, "This is indeed a welcome move as it will bring in significant efficiencies and reduction in logistic costs for many automobile OEMs in and around the Chennai region, including us."

In his speech, Prabhu said inadequacy of warehousing and transportation facilities was also one of the causes that kept potential customers away from the railways. "In order to complete the chain of transportation, it is proposed to develop rail side logistics parks and warehousing.

These logistic parks and warehouses would be created in PPP mode to bring the required efficiency and investment but also help attract greater traffic to the railways," the minister said. He further said, "With the coming in of TRANSLOC, the Transport Logistics Company of India, we will be witness to a paradigm shift in our role as a national logistics provider.

The focus will be on providing last mile connectivity for freight business and significant reduction in logistic costs. At least 10 goods sheds will be developed by TRANSLOC in 2016-17." Nissan India Operations President Guillaume Sicard said the announcement to create a rail auto hub in Chennai is a clear demonstration of the government's commitment to the Make in India initiative.

"Chennai is one of major auto hubs in India and needs efficient and cost-effective infrastructure and logistics support. Now, with the rail auto hub, it will be a much-needed shot in the arm for economical, timely and efficient transportation of our cars to the port and will aid our export strategy immensely," Sicard said.

Nissan India is one of the largest exporters of passenger cars and has reached the landmark export figure of six lakh cars recently. "We welcome all initiatives to provide better and efficient infrastructure," Sicard added.