Less cargo to ferry but truck sales continue to thrive

By: | Updated: September 29, 2015 10:50 AM

Due to reduction in diesel prices by Rs 4.77 per litre on a couple of occasions and lack of availability of cargo from the agriculture, manufacturing and infrastructure sectors...

trucksDue to reduction in diesel prices by Rs 4.77 per litre on a couple of occasions and lack of availability of cargo from the agriculture, manufacturing and infrastructure sectors

Due to reduction in diesel prices by Rs 4.77 per litre on a couple of occasions and lack of availability of cargo from the agriculture, manufacturing and infrastructure sectors, truck rentals fell by 5-6% in August, report from Indian Foundation for Transport Research and Foundation showed.

However, despite the low availability of freight, medium and heavy commercial sales continued to grow since December 2014.

In August, the medium and heavy commercial vehicles sales increased by 35% y-o-y to 23,016 units. During April-August period the volumes of heavy commercial vehicles rose by 27% y-o-y to 108,153 vehicles. In July, rentals fell by 3-4%. Most of the manufacturers attribute this growth to the improving economic situation in the country but the fleet owners irrespective of the size have different opinion on the subject.

According to them, the National Green Tribunal’s order banning diesel trucks more than 10 years old from plying in Delhi is compelling them to buy new trucks. This is hurting small time fleet owners who buy pre-owned vehicles from large fleet owners as they do not have the wherewithal to buy new trucks.

Further, trucks older than 10 years are not allowed to ply on national routes and are used to transport goods within a particular state.

Decreasing exports have hit the transport industry hard as the freight to and from the ports have decreased significantly.

Lack of return cargo especially from north and east region has been hurting the road transport industry for a long time. According to Vivek Arya, managing director, Rhenus Logistics, customers always demand new trucks for ferrying the goods on national route and due to lack of return cargo companies have to deploy more trucks on single trips on numerous routes. As result the companies are buying new trucks.

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