Vehicle transport through trains won’t hurt truck freight significantly: SIAM President

Demand for truck freight will remain unaffected despite the growing reliance on railway sidings for vehicle transport, Shenu Agarwal, President, Society of Indian Automobile Manufacturers (SIAM), told businessline. “There has been a lot of chatter about how railways will affect truck trade.

But I don’t find much weight in this discussion... the world over, we have seen that truck freight cannot be replaced. It’s not just a matter of sheer economics; railways can do it more efficiently, but railways cannot provide you a comprehensive solution,” he said.

The customer may be looking at efficiency, but first they’re looking at the entire comprehensive solution and railways will never be able to do that, he added. “Railways may present a part of the solution, but that still means that while that part will be taken away, additional parts will get created.

So, I don’t think it will have an impact on the volume of the trucks that are on the road. It may have certain other impacts, but nothing significant,” Agarwal added. Analysts tracking the industry also said railways may save time on transport of the vehicle containers across the country, much ahead of the trucks on roads, but for the last-mile connectivity, these trucks would only help the railways.

According to the latest data compiled by the Federation of Automobile Dealers Associations (FADA), retail sales of heavy commercial vehicles (HCV) increased 14 per cent year-on-year to 26,640 units in August. Meanwhile, companies like Maruti Suzuki India (MSIL) and Hyundai Motor India (HMIL) have also been recording an increase in their transport of vehicles through railways.

MSIL, for instance, has increased the share of rail in its outbound vehicle dispatches from 5 per cent in FY15 to 26.5 per cent in FY26 and dispatched over 32 lakh vehicles cumulatively till date. The company aims to increase that share to 35 per cent by FY31, reinforcing its commitment to green logistics, it said.

Similarly, HMIL said it has increased transport of vehicles through railways over the past few years. “It is going up continuously. Earlier, it was for exports (till ports), but not domestic and we are making more and more stockyards near railway stations.

We currently have four to five stockyards, and I think we are soon going to increase them... Six-seven years ago, railways was 17-18 per cent of our shipments, now it is more than 25 per cent and this is despite no railway line in the plant,” Tarun Garg, MD and CEO, HMIL told businessline.