The Hindu Business Line : Ennore Port gets boost from Nissan business

Chennai, Oct. 18 Armed with the prospect of long-term business from Nissan Motor India, Ennore Port Ltd will soon begin work on a Rs 110-crore facelift that will enable it to handle export of cars.

In six months, Ennore Port will be ready with a quarter-kilometre-long ‘common user terminal’ where car-ferrying ships can anchor in the 12-metre deep waters. Abutting the waterfront will be enough space to park 5,000 cars.

If Nissan alone uses the terminal, EPL’s investments will be paid back in six years.

Nissan expects to begin exporting (mostly to Europe) 1.1 lakh cars a year — cars that will be manufactured at a facility created by a joint venture of the Japanese company, and Renault of France.

The plant, at Oragadam near Chennai, will make cars for both the companies. Nissan also expects to ramp up exports — up to perhaps 2 lakh — in line with market demand.

Why not Chennai port?

Nissan should have liked to use the Chennai port, which is nearer to the car plant by 25 km. But there is not enough room there, Hyundai having taken up most of it. In fact, Chennai port charges Hyundai 0.30 per cent of the FOB value of cars, lower than the 0.45 per cent that Nissan has agreed to pay the Ennore port.

Also, any benefit of expansion at Chennai port will first go to its anchor customer, Hyundai. The Korean company has sent 1.17 lakh cars out of the port so far in the current financial year, against 1.38 lakh cars in 2006-07. According to Mr K. Suresh, Chairman, Chennai Port Trust, some 5 lakh cars would be shipped from 2011. Hence, there is substantial “spill over from Chennai port” that Ennore could capture.

Mr S. Velumani, Chairman, Ennore Port, and Mr Shouhei Kimura, Managing Director, Nissan Motor India, on Saturday signed a memorandum of understanding for Nissan to use the port.

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