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Truck rental go up by 5.5 per cent on the back of diesel price hike

May: The truck rentals remained flat during the first fortnight of May but after aRs.3/ltr cumulative daily diesel price hike post Karnataka polling during second half May 2018, leading to 4.5 to- 5.5 per cent rise in truck rentals on medium in long haulage trade routes as against 5 to 5.5 per cent drop in full truck load freight charges during April 2018. 

The manufacturing output growth has dropped to 4.7 per cent from the corresponding period last year which was almost 7.8 per cent. At the same time truckers have started migrating to high tonnage M & HCVs, particularly multi-axle rigid body trucks and trailers to bring down their per ton km fixed and variable cost /expenses to have more fuel efficient BS-IV goods carriages, while cargo offering during May'18 remain virtually flat as factory output did not offer buoyant cargo across the trade / transport centres in the country - Indian Foundation of Transport Research and Training monthly Report. 

 Truck rental trend: On the one hand, truck fleet owners and transporters have been threatening nationwide indefinite strike (chakka jam) to protest against diesel price hikes and upstick in tyre prices and third party motor insurance premium, but on the other hand, despite low cargo growth from various sectors during May 2018, the truck rentals on medium and long haulage on trunk routes have gone up by 4.5 to 5.5 per cent. Truckers cited hefty daily cumulative diesel price hike of over Rs.3/ltr by OMCs on the back of steep increase in international brent crude price to $78/bbl during May 2018. 

Simultaneously, truck fleet owners and transporters are heavily focused on to replacing and expanding their truck fleet with fuel efficient BS-IV multi-axle rigid body trucks and trailers in order to average out their running cost to meet the medium term challenge posed by diesel price escalation due to international uncertainties and weakening rupee against dollar currency. 

         The following is the truck rental table for the period of 2nd May'18 to 1st June'18  (i.e.May month 2018):

 

FULL TRUCK  LOAD (25.2 TON G.V.W.) rental (Rs per round trip)

  Trunk Route

Rental Movement

( per Round Trip)

(for 15 ton PAY LOAD)

 

Round Trip/ 

15 ton pay load

1

Rental as on           2nd May'18

2

Rental as on          

1st June'18

3

Average Monthly truck rentals during Jan-Dec 2015 

4

Average Monthly truck rentals  during Jan-December 2016

5

Average Monthly truck rentals  during Jan-December 2017

6

  Delhi - Mumbai-Delhi

87200

92000(+5.5%)

76967

84921(+10%)

81900(-3.7%)

Delhi - Nagpur-Delhi

83300

87900(+5.5%)

76767

84563(+10%)

80320(-5.3%)

Delhi - Kolkata-Delhi

82600

87000(+5.4%)

78400

86275(+10%)

80125(-7.7%)

Delhi - Guwahati-Delhi

143500

151400(+5.5%)

131950

140763(+7%)

140758(-2.9%)

Delhi - Hyderabad-Delhi

116700

123000(+5.4%)

109317

119400(+9%)

111983(-7.6%)

Delhi - Chennai-Delhi

122100

128000(+4.9%)

122308

131925(+8%)

119016(-10.8%)

Delhi - Bangalore-Delhi

130700

137900(+5.5%)

121792

131708(+8%)

126200(-4.4%)

Delhi - Ranchi-Delhi

111000

116000(+4.5%)

79600

87350(+10%)

86550(-5.8%)

Delhi Raipur-Delhi

79500

84000(+5.5%)

76208

82763(+9%)

77000(-7.5%)

Delhi - Kandla-Delhi

85700

90400(+5.0%)

61358

72517(+19%)

81666(-1.1%)

Delhi - Bilaspur-Delhi

83500

88100(+5.5%)

75950

83467(+10%)

80666(-3.5%)

 

Emerging Scenario:  With e-way bill under GST system on intra-State and inter-State movement of cargo becoming a reality and thereby e-way bill digital transit pass system makes tax-evasion difficult with every passing day. 

The formal sector businesses / factories /distributors are seeking truck fleet attached to its production and delivery points across the country on a contractual basis with specific age, size and body fabrication of goods carriages according to the nature of goods to be ferried. 

The demand for BS-IV fuel efficient multi-axle trucks and trailers with covered body and /or containers as cargo deck are being procured by fleet owners leading to substantially higher demand for new trucks on the back of deep discounts and 100% funding with low EMI being offered to fleet owners in the country.

While retail sales of one or two trucks has been on decline and large fleet owner transport contractors are emerging fast. However, with stabilization of GST and full enforcement of e-way bill should bring more efficiency and seamless movement of goods may stifle the truck sales unless manufacturing grows by 8 to-9 per cent and agri-produce by 4 to 5 per cent in next quarters during the current fiscal according to a report from Indian foundation of transport research and training.
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