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railways: Indian Railways cuts SUV mass transport rates by 33%

Sport-utility vehicles (SUVs), currently riding high in the local market, can now hitch a cheaper ride on Indian Railways. Automakers planning to ship these popular vehicles in a cost-friendly way cross country have received a boost from the railways, who unveiled a new, budget-friendly slab for mass SUV transportation.

Wagons are also set to be redesigned as the railways look to capitalise on the growing popularity of SUVs.

According to officials aware of the matter, the new rates for transporting SUVs is 33% lower than the existing charges for moving large passenger vehicles. “There was a demand from automobile transporters to rationalise rates since demand for large cars has risen in the Indian market,” a top railways official told ET. SUVs have become the rage with the share of such vehicles rising to 49% in the domestic passenger vehicle market in calendar year 2023. In comparison, the share of small cars, once the dominant category, fell to about 30% in the same period.

Until now, the railways charged loading costs for both upper and lower decks even if just one deck was used for ferrying vehicles. The official said the latest change in rate seeks to address this. Typically, a Bi-level Auto Car wagon type (BCACBM) is used for transporting cars. It can load one car (less than 1.6 metres in height) each in the upper and lower deck. However, only one large car, popularly called a SUV and taller than 1.6 metres, can be safely loaded in such a wagon. A train of 27 wagons can carry either 318 small cars or 135 SUVs. India technically defines SUVs as those being longer than four meters, having an engine capacity of at least 1,500 cc, and 170 mm ground clearance. However, Indian Railways categories vehicles as per total height. Under the new tariff regime, a SUV loaded in a single deck will be carried up to 100-kilometre distance for Rs 11,719, down from Rs 17,579 in BCACBM wagons.

Maruti Suzuki, Transport Corporation of India (TCI), APL Vascor, Adani NYK, IVC Logistics and Joshi Konoike have secured Automobile Freight Transport Operator (AFTO) licences, which permits them to move passenger vehicles on Indian Railways. Over a fifth of all passenger vehicles produced in the country are now transported through railways, a five-fold increase since FY18 as companies look at cost-efficient modes of transportation. The Railways also plans to introduce wagons with design changes to facilitate efficient transport. “Auto Car Taller wagon (ACT1) will soon be rolled out for transporting SUVs in both decks.,” the official said.

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