The port, which is around 190km north of Chennai, is one of India’s deepest ports at 18.5m and reputed to be the deepest on the east coast of the country.
The terminal project, which is being backed by Krishnapatnam Port Container Terminal (KPCT), involves the creation of a new 350m long terminal that will be able to accommodate 15,000 vehicles adjacent to a ro-ro ramp, in the port's southern zone.
At present, those car manufacturers based in the region around Chennai and Bangalore, such as Hyundai, Ford and Nissan, currently export output mostly via Chennai port, India's largest for finished vehicles traffic. Last year, for example, it handled 250,000 units, although is seriously space-constrained, which has resulted in congestion.
Furthermore, the congestion has resulted in the levying of surcharges in the last couple of years. Other, "non-billable" consignment charges are also said to be a problem. As a result this adversely affects production schedules, as well as inflating logistics costs.
Many exporters have therefore switched consignments to the port of Ennore, which reported traffic of 200,000 units last year and is used by Nissan and Toyota Kirloskar. However, Ennore has its own problems with available space and access to the port is also reportedly hampered by the unfinished Ennore-Manali Road Improvement Project.
Krishnapatnam, meanwhile, has a 45km railway siding inside the port, prompting the port’s chief executive to dismiss suggestions that the longer distances from the manufacturing plants might prove a hurdle to developing a strong export traffic.
Backing this up, car manufacturer Ford India was reported in the local press as saying that, while for the moment its entire export production would be channelled via Chennai, should volumes continue to rise, the company may well have a look at Krishnapatnam as a future option.
Earlier this year at the Geneva Motor show it was reported that Ford was planning to export its EcoSport SUV from India to supply the European and UK markets later this year. The vehicle went into production at Ford India’s Maraimalai Nagar plant near Chennai for the local market last year.
Ford also makes the Figo, Fusion, Fiesta and Endeavour models at the plant and is keen to exploit capacity and build exports from there.