Truck rentals may rise 3-4%
Rentals were already high due to strong manufacturing sector growth.
Truck rentals are likely to go up by three-four per cent following the Rs 2-a-litre hike in diesel prices. Transport companies may also raise freight charges for consignments by 10-12 per cent.
S P Singh, coordinator, Indian Foundation of Transport Research and Training (IFTRT), said the increase in the price of diesal might lead to a three-four per cent rise in truck rentals on the back of a buoyant economy.
| TRUCKING NEW TROUBLE | |||
| Truck route (Round trip/ 9 tonne payload) | Rental as on 25-Jun | Weighted diesel | |
| Rs 2/litre | % increase expected | ||
| Del-Mum-Del | 48,100 | 1,400 | 3.0 |
| Del-Nagpur-Del | 46,800 | 1,300 | 3.0 |
| Del-Kolkata-Del | 46,800 | 1,400 | 3.0 |
| Del-Guwahati-Del | 86,000 | 3,000 | 4.0 |
| Del-Hyd-Del | 68,500 | 2,200 | 3.5 |
| Del-Chennai-D el | 76,200 | 2,600 | 3.7 |
| Del-Bangalore-Del | 74,200 | 2,600 | 3.5 |
| Del-Ranchi-Del | 45,600 | 1,300 | 3.0 |
| Del-Raipur-Del | 46,100 | 1,300 | 3.0 |
| Del -Kandla-Del | 32,800 | 1,000 | 3.7 |
| Del-Bilaspur-Del | 48,900 | 1,300 | 3.0 |
| The above calculation is based on fuel consumption per truck per round trip Source: Indian Foundation of Transport Research and Training | |||
Truck rentals rose 21-23 per cent during November-May due to 16.5 per cent growth in the manufacturing sector and almost 25 per cent increase in imports and exports According to a compilation by IFTRT, truck rentals on medium and long haulage remained firm as the truck freight market and the manufacturing industry were expecting a Rs 3.20 per litre hike in diesel.
“The manufacturing sector alone is growing over 16.5 per cent. Apart from manufacturing, cargo offerings came from the import-export trade, agricultural commodities, both dry and wet products, and infrastructure,” he said.
When the economy started picking up in November 2009, truck rentals shot up due to a mismatch in demand and supply. Since then, the rentals have been rising consistently. The rentals also flared up due to the 10-12 per cent hike in tyre prices during January-June. “Diesel and tyres account for 90 per cent of the operating cost of a truck. Truck rentals have outpaced the increase in operating cost during the period. In June, effectively, truck rentals are overpriced by 8-10 per cent due to the demand for trucks outpacing the supply, following the increase in inter-state movement,” he said.
Since new national permits were not issued in May, it accentuated the shortage of trucks on trunk routes, Singh said.