How is Hyundai Reshaping Sustainable Logistics in India?
Hyundai Motor India Limited (HMIL) is at the forefront of transforming India's approach to sustainable logistics through its robust adoption of rail freight for the domestic movement of vehicles.
This strategic choice not only steps up the efficiency of nationwide vehicle delivery but also substantially cuts down emissions in the process.
Hyundai: Sustainable supply chain logistics
In 2024, a significant leap was made when Hyundai directed 156,724 units through railways, representing 26% of its total domestic wholesale. This shift resulted in the reduction of carbon dioxide (CO2) emissions by up to 18,352 tonnes.
This is not just a one-off achievement.
From 2021 to 2024, HMIL effectively disbursed a grand total of 537,499 units via rail, curbing CO2 emissions by an impressive 63,452 tonnes. The commitment to rail freight is showcased even more in the North-East region, where Hyundai ensures 100% of its vehicle deliveries are conducted through rail, leveraging India’s growing railway infrastructure to its fullest.
Focused at the heart of these operations is Hyundai's dispatch hub in Sriperumbudur, Chennai. This pivotal facility is instrumental in ensuring that vehicles are dispatched all across India in a timely and environmentally friendly manner. This operational strategy not only aligns with, but actively supports, India's ambitious rail infrastructure ventures.
The Indian government is actively enhancing the railway network with substantial investments in projects like the Dedicated Freight Corridors (DFCs). These initiatives are aimed at improving the efficiency of freight movements and reducing congestion on traditional rail routes. Expected to increase the handling capacity for greater freight volumes, these corridors promise to stimulate economic growth while significantly mitigating environmental impacts.
At HMIL, we have been relentless in our pursuit of promoting sustainability in all facets of our operations, be it manufacturing, dispatches, sales or after-sales support.
By utilising Indian Railways’ extensive rail-network for delivering Hyundai vehicles from our plant in Sriperumbudur, Chennai, to multiple locations across India, we have effectively prevented 18,352 tonnes of CO2 emissions in CY 2024, dispatching 1,56,724 units in the process.
As the Government of India continues to upgrade the rail infrastructure with dedicated freight corridors, and modern and energy efficient rolling stock ensuring faster movement of goods, HMIL remains committed to utilising rail freight to optimise its logistic operations, leading to long-term reduction in emissions.
India’s rail network
India boasts the fourth-largest railway network globally, accommodating daily travel for 26 million passengers and handling 3.37 million tonnes of freight. With a fully electrified track system across 14 states and union territories, railways continue to be a cornerstone in the nation's logistics framework.
The recent years have witnessed a significant modernisation of the rail system, with the freight volume managed by Indian Railways surging by 157%, from 1,231 million tonnes in 2021 to 3,167 million tonnes by 2023. The DFCs, launched in December 2020, are pivotal in the National Rail Plan which seeks to elevate rail’s share of freight traffic from 28% to 44% by 2051.
The visionary national projects such as the National Logistics Policy, expedited by Prime Minister Narendra Modi, are crucial in reducing logistics costs from 15% of GDP to 8% by 2030 and enhancing the cost-effectiveness and environmental sustainability of freight transport.
According to a study from the University of New South Wales, the DFCs could potentially augment India’s GDP by ₹16,000 crore. Studies like the Rail Partners’ 'Freight Expectations' note that rail freight emits 81% less particulate matter than road freight, further underscoring the environmental benefits, irrespective of the electrification status.
The future of sustainable logistics
Hyundai’s initiatives are a powerful demonstration of how commercial ventures can harmoniously align with government infrastructural projects, yielding mutual benefits. By integrating India’s extensive rail network into its logistics strategy, Hyundai not only optimises costs but also plays a pivotal role in sculpting a sustainable future for the country.
With the expansion of DFCs, Hyundai is poised to diminish its environmental footprint while enhancing its distribution efficacy. In an era where global attention is converging on sustainability, Hyundai’s proactive steps provide a practical framework for other corporations aiming to achieve environmental and economic sustainability.
In alignment with the Indian government's efforts to revamp the rail infrastructure, this synergy between the public and private sectors is expected to catalyse significant environmental and economic benefits in the forthcoming years.
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