Thanks to diesel price cut, truck rentals drop 5-6% in January

A healthy flow of winter fruit and vegetable crops in most parts of the country has not been able to hold truck rentals at last month’s level

Truck rentals dropped by 5-6 per cent in January 2016 compared with December 2015, after oil marketing firms had cut the diesel price by ₹1.91 in two tranches on January 1 and January 15, says Indian Foundation of Transport Research and Training (IFTRT).

Truck rentals drop 5-6% in January

A steady and healthy flow of winter fruit and vegetable crops in most parts of the country has not been able to hold truck rentals at last month’s level, which saw a 2-2.5 per cent increase during December 2015 because the cargo offerings from factory gates have seen a significant cut.

It has adversely impacted the round trips by 25-30 per cent in the New Year as consumer spending too dropped after the festival season ended. Exports also continue to remain in the negative territory.

In a related move, IFTRT said that NHAI’s decision to control overloading on highways has the potential to increase the demand for trucks and trailers at least by 25-30 per cent.

It can also help optimise fleet utilisation, and result in firming up of truck rentals. But, the NHAI’s decision is stuck due to the laxity on the part of toll collectors, many of whom allegedly underreport toll collections at one end and also turn a blind eye to overloading by fleet operators that regularly use the National Highways.

source: http://www.thehindubusinessline.com/