Bangalore and Chennai see rise in truck freight rates, shows data

The cost of transporting goods by truck in Bangalore and Chennai saw an uptick in March.

Rates are up 1-2 per cent, shows an analysis of data collated by the Centre for Monitoring Indian Economy (CMIE), while it remained unchanged in other major metropolitan cities including Mumbai, Lucknow, Ahmedabad, Hyderabad, Trivandrum, and Kolkata.

The expense is on a per kilometre basis for transporting goods using trucks with a capacity of 15 tonnes. It is calculated as the cost incurred per kilometre from Delhi to various cities in India.

The per kilometre cost of transporting goods using a 15-tonne truck rose six per cent to Rs 96.3 from Delhi to Chennai in March. It was Rs 91 a year ago. The Delhi-Kolkata rate rose 3 per cent to Rs 42.9 in March 2024 from Rs 41.7 a year ago. The cost to Bangalore rose 1 per cent to Rs 42.3 compared to Rs 41.8 in March 2023.

Freight rates from Delhi to Trivandrum have seen a decline by four per cent, while from Delhi to Jaipur, there has been a decline by 10 per cent in this time period.

Vehicle registrations, which represent the retail sales, have seen a rise across different categories. In March, there were 26,898 heavy goods vehicles that were registered, similar to the same month last year.

Congestion resulting from inadequate road infrastructure and the lack of a city bypass network has greatly reduced the average speed of trucks in India, as per an EY report titled ‘Envisioning the Future of India @2047’.

Indian trucks typically travel an average daily distance of 250 km to 400 km, significantly less than the 700 km to 800 km covered by trucks in the EU and the US. Furthermore, India's truck fleet is predominantly composed of smaller 16-ton to 25-ton vehicles, and India has a high percentage of empty running.

These factors inflate the total cost of ownership, leading to a substantial increase in transportation costs.