Concor aims to reduce cost by 15%

Container Corporation of India (Concor) plans to cut costs in a big way from the next quarter. This move is expected to bring down its costs by about 10-15 per cent.

The company also plans to establish stiff efficiency benchmarks starting October. "Saving on costs is the only way we can be competitive in our tariffs vis-à-vis roads," RK Mehrotra, managing director of Concor, said today.

He also said since the last quarter, Concor had increased tariffs by 4 per cent, despite a rise in payments to the railways by 13 per cent due to a revision in freight.

In addition, Mehrotra said as truck freight had shot up by nearly 10 per cent during the same period, transportation of containers via rail was more economical.He said with competitive freights, Concor could meet the competition from road container traffic head-on and also improve its share. At present, Concor's share in total container traffic is about 30 per cent.

Regarding improvements in efficiency, he said benchmarks were set in terms of number of containers carried per wagon, the number of handling equipment like cranes per 1000 twenty foot containers carried, moves per hours of various handling equipment, and operating expenditure per 1000 twenty foot containers.

For instance, he pointed out that Concor had set a target of filling 10 per cent of its vacant space on flat rakes meant for carrying containers en-route.

The norm will be followed if Concor manage to fill only 15 per cent of its train space at the starting point. Mehrotra added that meeting such a target was possible as Concor was setting up more inland container depots, with 5 of them already coming up this year.

"The step was taken when the railways had decided to charge for haulage of empty flats too," he said. It was, therefore, decided that capacity-utilisation be maximum to ensure that the company covered its costs.