The new agreement grants Nissan certain concessions in the use of the wharf, allowing it to handle up to 60,000 units per year there at the rate of 0.36% cent of the wharfage for a car. In addition, it will not have to pay any parking charges for the first 15 days and will also receive priority handling in the port.
Nissan and Alliance partner Renault are contractually bound not to make use of the adjacent port of Kaupalli or Krishnapatnam port, which is some 30km from Ennore. The Alliance will divert consignments to the port of Chennai should Ennore be unable to handle volumes. Should the carmakers use any other seaport other than those agreed the contract will be automatically dissolved.
The various parties had signed a previous agreement in September 2009, which lasted three years. Ennore port currently earns around $8m annually from Nissan.
According to Nissan Motor India, the company remains confident that it will meet targets set for export vehicles over the coming year, as well as boosting its market share to 10% in the near future. It first began using Ennore port in September 2010, being the first manufacturer to do so to ship exports.
In the last two years, it has dispatched around 200,000 units to around 100 countries from India.
Nissan established its manufacturing plant at Oragadam in 2008, investing around $712m. This was followed in March 2010 by Nissan and Renault's joint production and research and development facility.