Truck rentals on trunk routes rose 3-4% in April

Rise despite OMCs skipping their monthly diesel price hike of 50 paise per litre

Truck rentals on trunk routes rose three to four per cent in April, according to the monthly report of the Indian Foundation of Transport Research & Training (IFTRT), a non-government body.

It says there was a 15-20 per cent rise in arrivals of summer fruits and vegetables, diversion from trunk routes to wheat harvesting regions and improved fleet utilisation of five to 10 per cent. The rise in rentals was despite oil marketing companies deciding against the monthly rise in diesel prices of 50p a litre.

S P Singh, Senior Fellow at IFTRT, said the peak marriage season in large parts of the country and additional agricultural income in rural and semi-urban areas were also factors. So was more consumer spending in metropolitan cities on white goods,  electronic items, garments, furniture and house building material.

He said truck rentals between April and mid-September 2012 dropped 12-14 per cent on trunk routes. They’d risen in the previous 10 quarters, from October 2009. Over-capacity in haulage created in this period, allied to a decline in manufacturing output growth, and a fall in infrastructure and construction sector activity resulted in the subsequent drop in rentals.

Even after absorbing a diesel price rise of Rs 5 a ltr in September 2012 and Rs 1.50 rise in three stages between January and March 2013, truck rentals still fell by seven to eight per cent in the financial year ending March.

He said in April 2012, truck rentals dropped by three to five per cent on trunk routes due to late arrival of summer fruit and vegetables, dislocation in wheat procurement due to hailstorms and a growth decline in manufacturing.