Long berth delays at the Sri Lankan port of Colombo has led the Sri Lanka Ports Authority (SLPA) to route all car carriers through Hambantota port starting May 31st 2012.
Despite making additional parking areas available in Colombo, the SLPA concedes that the parking remained highly congested given the large influx of imports.
This situation has been exacerbated by slow clearance by importers, even though the SLPA increased parking charges recently. Not only has the failure of importers to swiftly clear vehicles resulted in congestion, vehicle theft and vandalism have also risen.
Car carriers can often wait up to 10 days in the outer harbour prior to being handled at Colombo, which in turn has driven up the price of imported vehicles. This week, four vessels delivering vehicles from Japan were still waiting to discharge a total of around 2,000 vehicles because of congestion, despite having been anchored off the port for two weeks.
The problem of limited storage space at Colombo has been exacerbated by car importers failing to clear previous vehicle shipments after a significant tax increase that came into effect at the beginning of April.
SLPA spokesperson Nalin Aponso said that around 1,400 cars already unloaded had not been cleared after the tax increase.
Understandably, many car carriers have grown reluctant to call there.
Hambantota, which is 240km to the southeast of Colombo, is viewed as the most suitable alternative, as it offers simplified clearing arrangements and extensive parking areas. All vehicle importers are expected to switch to the new port, which the SLPA says is now its preferred transhipment hub for vehicles, something that it is supporting through attractive rates to shipping lines.
It is also hoped that the new port can help boost the declining market in transhipped vehicles. In 2009, Colombo handled 4,973 transhipment vehicles and, in 2010, 2,455. By 2011, just 993 vehicles were rotated in an out of the port by sea.
