Waning traffic pushes Railways to cut down passenger coach production

The Indian Railways has proposed to cut down its passenger coach production almost by half over next couple of years as it looks to get leaner with competition from roadways and airways eating into its traffic

In a meeting taken by the Railway Board to finalise coach manufacturing programme for FY23 and FY24, it was decided that passenger coach production from four of its manufacturing facilities will be cut down by over 46 per cent in FY24.

This would mean Railway's coach manufacturing would fall from a level of around 6,000-7,000 units to just about 4,000 a year. In fact, the passenger coach manufacturing has been kept at 7,551 units for next fiscal year 2022-23 that would fall just about 4,027 units in FY24, as per a letter dated July 28 shot off by the ministry of railways to general managers of all its four coach manufacturing units.

Most striking cuts have been proposed for LHB or Linke Hofmann Busch coaches that are made to run Railway's passenger services. Here the production is proposed to fall from about 5,489 units in FY23 to just about 1,677 in FY24, a drastic 70 per cent cut.

Currently the Linke Hofmann Busch (LHB) coaches, being manufactured by Indian Railways' production unit - Integral Coach Factory, Perambur, Chennai; Rail Coach Factory, Kapurthala and Modern Coach Factory, Raebareli. Besides, Central Railway, (Latur) Mumbai facility also makes a few designs of self propelled coaches.

Sources said that the Railway Board had decided to cut down production of passenger coaches as the existing inventory is considered more than adequate to meet the requirement of passenger movement. Moreover, with Railways foreseeing large scale movement of its traffic to roadways and airways, it does not want to overspend with stepped up manufacturing of coaches without getting a clearer picture on demand conditions.

Official sources also indicated that the Railways is also correcting its cost structure that would also see its focus getting into more revenue generation services than ones that are subsidised. However, this would mean curtailment of existing passenger services but scaling it down in line movement of traffic away from its services.

As against sharp cut proposed for LHB coaches, the Railway Board has decided that production of self propelled coaches used for EMU or metro services would actually rise in FY24 from a level of 2,062 units in FY23 to 2,359 units in FY24. The biggest segment in this rise would come from production of complete train set coaches whose production from three coach manufacturing units will rise from 672 units in FY23 to 928 units in FY24.

Non RSP (rolling stock programme) funds are to be built only after clear realization of funds. If sufficient orders as per this program do not materialize for non RSP Coaches, RSP Coaches may not be built in lieu thereof unless clear instructions from Railway Board exist for the same, the letter mentions.