Revolutionising Automobile Logistics: How Railways Are Moving India’s Cars
That model is now changing.
Across India, automobile manufacturers are increasingly turning to railways to move finished vehicles from factories to distribution hubs, dealerships, ports and even international borders. What was once a niche logistics option is becoming an important component of the automotive supply chain.
The transformation involves much more than replacing trucks with trains. It represents a fundamental shift towards factory-to-rail terminal-to-hub-to-dealer logistics, supported by specialised automobile wagons, dedicated sidings, hub-and-spoke distribution and increasingly integrated rail infrastructure.
And there is another important dimension: carbon emissions.
From road dependence to rail-led distribution
India produces millions of vehicles every year, yet a large proportion of finished vehicles still moves by road.
Railways has therefore been working with automobile manufacturers to increase the attractiveness of rail for finished-vehicle logistics. The Automobile Freight Train Operator (AFTO) framework was an important milestone, allowing private participation in specialised automobile freight trains.
Maruti Suzuki became the first automobile manufacturer in India to obtain an AFTO licence in 2013 and began developing specialised rail-based vehicle distribution at scale.
The results demonstrate what can happen when the manufacturer, railway infrastructure and logistics ecosystem are designed around one another.
In calendar year 2025, Maruti Suzuki transported more than 5.85 lakh vehicles by rail, representing approximately 26% of its outbound vehicle logistics. The company reported that this avoided approximately 87,904 tonnes of CO₂e and saved more than 68.7 million litres of fuel, using its stated GLEC-based methodology.
The company has subsequently crossed 3 million cumulative vehicles transported by rail, with rail accounting for 26.5% of its vehicle dispatches in FY2025-26. Its stated ambition is to increase the share to 35% by FY2030-31.
This is no longer an experiment.
It is becoming a logistics network.
Manesar: the factory siding changes the equation
One of the most significant developments has been the creation of dedicated railway infrastructure inside automobile manufacturing facilities.
Maruti Suzuki's Manesar plant railway siding, commissioned in 2025, is particularly significant. Instead of moving finished vehicles by road from the factory to a distant rail terminal, the railway comes directly into the manufacturing ecosystem.
The siding can handle up to 450,000 vehicles annually at full capacity.
By March 2026, the facility had already crossed 100,000 vehicle dispatches. The company estimated that these movements had avoided around 16,800 tonnes of CO₂e.
This is strategically important because every additional road movement eliminated between factory and rail terminal improves the economics and environmental performance of the rail model.
The concept is simple:
FACTORY → RAIL SIDING → AUTOMOBILE RAIL → REGIONAL HUB → DEALER
rather than:
FACTORY → TRUCK → RAIL TERMINAL → HANDLING → TRUCK → DEALER
The first model removes friction from the supply chain.
Panesar/Manesar to South India — and now closer to Kerala
The southern market provides an excellent example of how automobile rail logistics is evolving.
Maruti Suzuki has historically used destinations including Chennai and Coimbatore for rail-based vehicle distribution. In August 2026, it added Pollachi Railway Terminal in Tamil Nadu to its network.
The first rake from the Manesar in-plant siding carried 120 vehicles, including WagonR, Ertiga, Dzire and Celerio.
The new Pollachi connection is expected to support nearly 70 automobile rakes a year and more than 11,000 additional vehicle deliveries annually by rail. Significantly for Kerala's automotive market, Maruti positioned the development as a means of improving service to southern markets ahead of the Onam season.
This creates an interesting logistics proposition for Kerala.
Instead of every vehicle travelling the entire distance from North India by road, rail can carry the long-haul portion while local road transport handles the final distribution.
That is precisely where multimodal logistics becomes powerful.
Long haul by rail.
Last mile by road.
The objective is not to eliminate trucks.
It is to use trucks where trucks are most efficient.
CONCOR's role: connecting rail with logistics
The automobile story cannot be viewed only through Indian Railways.
The wider ecosystem includes terminal operators, logistics providers, automobile freight operators, road transporters and organisations such as the Container Corporation of India (CONCOR).
CONCOR's broader role has traditionally centred on rail-led multimodal logistics, connecting production and consumption centres with ports, ICDs, logistics parks and inland terminals.
Its network and rail infrastructure provide an important platform for the wider shift from road-heavy logistics towards multimodal distribution.
The larger lesson is that automobile logistics needs an ecosystem, not simply a railway wagon.
The successful model requires:
- specialised automobile rakes
- loading and unloading terminals
- factory railway sidings
- regional automobile hubs
- road-based first and last mile
- tracking and visibility
- efficient rake turnaround
- predictable railway schedules
- port connectivity for exports
This is where CONCOR, Indian Railways and private logistics operators can complement the OEM's own distribution network.
Maruti's Gujarat model: rail becomes a carbon-management tool
The Gujarat experience takes the concept even further.
Maruti Suzuki's Hansalpur railway siding has been registered under the Verified Carbon Standard programme as a modal-shift transportation project.
The project is expected to reduce approximately 170,000 tonnes of CO₂e over a ten-year period, according to the company's stated methodology and project estimates.
This is significant because it changes the way automobile logistics can be viewed.
Rail is not merely a transport alternative.
It can become part of a manufacturer's measurable decarbonisation strategy.
The environmental benefit comes from shifting long-distance vehicle movement away from individual road journeys towards high-capacity rail movements.
Kia: large-scale SUV movement by rail
The shift is not restricted to Maruti Suzuki.
Kia's manufacturing facility at Anantapur in Andhra Pradesh has been part of India's expanding automobile-rail ecosystem. In 2020, Kia transported 5,000 SUVs on its 50th railway rake from Penukonda.
The significance was not simply the number of vehicles.
It demonstrated that rail could handle high-volume movement from an automobile manufacturing cluster to markets across India.
Kia's Anantapur plant has since grown substantially, with the company reporting more than 6.3 lakh cumulative dispatches from the plant, including domestic and export vehicles.
Mahindra: when automobile rail logistics crosses the border
Perhaps one of the most interesting demonstrations of rail's potential came from Mahindra.
In 2020, 87 Mahindra Bolero pick-up vehicles travelled approximately 2,100 km from Navi Mumbai to Benapole in Bangladesh by rail.
The movement was handled through a dedicated automobile railway operation and demonstrated that rail could support not just domestic distribution but cross-border automotive exports.
Mahindra also used rail for the movement of tractors towards Bangladesh. In another 2020 operation, 108 Mahindra tractors were loaded for Benapole.
More recently, Mahindra's rail logistics has continued to demonstrate the potential of cross-border automotive movement, including a 2026 Nepal-bound movement of tractors reported by logistics operator ATC.
The larger point is powerful:
Rail can connect an Indian factory not only with an Indian dealer — but with an international market.
Tata, Hyundai, Nissan, Renault and others
The evolution is broader than a few flagship examples.
Indian Railways' engagement with the automobile industry has involved manufacturers including Tata Motors, Hyundai, Mahindra & Mahindra, Honda and Maruti Suzuki.
Specialised automobile terminals have expanded across manufacturing regions such as Gujarat, Haryana, Maharashtra, Karnataka, Andhra Pradesh and Tamil Nadu.
The industry has progressively experimented with different wagon configurations, including NMG and higher-capacity automobile carriers.
Indian Railways has also recognised that wagon design itself can become a bottleneck.
In 2026, the Railways announced reforms allowing greater flexibility for automobile manufacturers to design specialised high-capacity auto-carrier wagons around specific origin-destination requirements, while recognising route restrictions such as tunnels, bridges and Schedule of Dimensions constraints.
This could be one of the most important developments for the next stage of automobile rail logistics.
The carbon equation
The environmental case for rail becomes especially powerful over long distances.
A single automobile train can replace a substantial number of individual vehicle-carrier truck movements.
The resulting benefits can include:
Lower diesel consumption
Lower CO₂ emissions
Reduced highway congestion
Lower exposure to road accidents
Reduced dependence on fossil fuels
More efficient use of long-haul transport capacity
Maruti's reported 2025 performance provides a useful real-world indicator: more than 5.85 lakh vehicles transported by rail, with approximately 87,904 tonnes of CO₂e emissions avoided according to its GLEC-based calculation.
Earlier milestones show the trajectory. In 2022, Maruti reported transporting more than 3.2 lakh vehicles by rail, avoiding around 1,800 tonnes of CO₂ and saving more than 50 million litres of fuel.
The exact carbon saving will naturally depend on route length, locomotive energy source, train utilisation, road alternative, terminal movements and the methodology used.
Therefore, the strongest sustainability argument is not simply:
“Rail is green.”
It is:
“For the right long-haul automotive corridor, modal shift from road to rail can materially reduce logistics emissions.”
The next revolution: factory-to-dealer by rail
The next phase could be even more interesting.
Imagine an automobile leaving the production line and entering a digitally managed logistics chain:
Factory → In-plant Siding → Auto Rake → Regional Hub → Dealer Network
The railway movement is planned according to production schedules.
The destination rake is linked to dealer demand.
GPS and digital visibility track the vehicle.
Regional hubs consolidate final-mile distribution.
AI predicts demand and positions vehicles closer to customers.
The railway therefore becomes part of the manufacturer's inventory and distribution strategy, rather than merely another transport mode.
What this means for Kerala
For Kerala, the opportunity is particularly interesting.
The state's automobile market is geographically elongated, with major consumption centres spread across Ernakulam, Thrissur, Kozhikode, Kannur, Kollam and Thiruvananthapuram.
Long-haul rail can potentially bring vehicles closer to the market, while specialised road carriers perform the final distribution.
The emergence of Pollachi as an automobile rail destination is therefore worth watching from a Kerala logistics perspective.
It raises a larger question:
Could South India develop a stronger network of automobile rail gateways serving Tamil Nadu, Kerala and Karnataka as an integrated distribution region?
That would require railway capacity, terminal infrastructure, suitable automobile rakes, OEM commitment and efficient first- and last-mile operations.
From car carriers to carbon-conscious supply chains
The automobile industry is entering an interesting phase.
The vehicle itself may be electric, hybrid, petrol or diesel.
But increasingly, manufacturers are also asking another question:
How sustainably did the vehicle reach the customer?
That makes logistics part of the automobile industry's carbon story.
Rail will not replace road transport.
Nor should it.
The future is more likely to be rail-led long-haul movement combined with road-based regional and last-mile distribution, supported by dedicated terminals, specialised wagons, digital visibility and better infrastructure.
India's automobile logistics revolution is therefore not about putting more cars on trains.
It is about redesigning the entire journey from factory to customer — and from factory to global market.
The road ahead
The next competitive advantage in automobile logistics may not belong simply to the manufacturer with the largest factory or the biggest dealer network.
It may increasingly belong to the manufacturer that can move a finished vehicle faster, more reliably, at competitive cost and with a lower carbon footprint.
And in that transformation, India's railway network is becoming more than infrastructure.
It is becoming a strategic extension of the automobile supply chain.
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