Truck rentals up 6 per cent on diesel price hike, cargo supporthttps://indianexpress.com/article/business/commodities/truck-rentals-up-6-per-cent-on-diesel-price-hike-cargo-support-5383517/

Truck rentals up 6 per cent on diesel price hike, cargo support

Diesel price during the month increased by Rs 4.60 a litre, which is sharpest during the last nine months — since January 2018.

business news, Truck rentals, diesel price hike, diesel price, diesel price delhi, cargo truck rental, Indian express
Industry has reconciled to the fact that truck rentals and retail freight charges are bound to rise for next several months due to the cues that the crude price could touch even /bbl by next March 2019.

Truck rental on the trunk routes has increased by 6 per cent in September on the back of a sharp increase in diesel price as well increased cargo offerings.

Diesel price during the month increased by Rs 4.60 a litre, which is sharpest during the last nine months — since January 2018. Moreover, on the back of a buoyant double-digit increase in cargo offerings from factory gates with steady flow of fruits, vegetables, food products and poultry items along with constant engagement of truck fleet in the infrastructure sector, saw truck rentals on the main routes gone by 6 per cent, said Indian Foundation of Transport Research and Training (IFTRT), the apex body tracking the truck industry for more than two decades.

According to IFTRT, with international Brent crude oil rising on the back of a weak rupee, the daily diesel price hike daze becoming a normal for trucking industry and as such the trade, commerce and industry have reconciled to the fact that truck rentals and retail freight charges are bound to rise for next several months due to the cues that the crude price could touch even $90/bbl by next March 2019.

Therefore, it has become convenient for truck transporters to increase truck rentals on trunk routes with effortless ease and pass on the fuel cost burden more than its real impact on to the truck hiring businesses in agriculture, manufacturing and infrastructure sectors.

Advertising

Normally, about 70-75 per cent of the truck rentals in the open market load are fixed by goods transport agents and truck unions in different parts of the country, while 25-30 per cent of the goods transportation business is contractual based on annual or multi-year rate contract between transporters/common carriers and corporate/PSU consigners in the country.

Interestingly, Q2FY19 (July-September 2018) has been a buoyant period despite the monsoon season as availability of cargo from all sectors — manufacturing, export trade, agri food items and truck fleet employment in the infrastructure sector too — has been fairly positive leading to improvement in more round trips for truckers on trunk routes and higher working hours on infrastructure projects of multi-axle heavy duty trucks and trailers.

The Foundation further said that during September 2018 the factory gates provided 10-15 per cent more cargo over last month with steady support of cargo offerings and fleet engagement in export trade, agri food items transportation to APMCs and engagement in major road building and construction projects. —FE