The truck transport industry is bearing the brunt of a slowing economy. Truck rentals are down by 15-20 per cent in various parts of the country due to a drop in cargo availability.
While there is excess supply of trucks, there isn’t enough cargo to feed the vehicles. This has resulted in a major demand-supply problem, said Mr M.K. Janaradanan of the Chennai-based Okay Transport.
The truck industry in Chennai, for instance, is grappling with shortage of load from sectors such as automobile spare parts, textiles and agricultural produce. A number of trucks are waiting for days in the Madhavaram truck terminal for want of cargo, he said.
A 16-tonne load to Delhi from Chennai today costs Rs 50,000, he said.
P. Mohan, a leading transport operator in Namakkal, said that vehicles are idle on the roads in and around Namakkal, which is a truck supply region south with a number of single vehicle owners. “It is a very bad scene. We are struggling to get cargo,” he said. There is a minimum drop of 20 per cent in rental, he said.
The research firm Prabhudas Lilladher in a report said that after a brief pause in truck rentals movement during July 2012, the rentals on the trunk routes declined 3-4 per cent during August with a 15-20 per cent all round drop in cargo availability across the country.
Most of the despatches of fresh fruit and vegetables are lower by 25-30 per cent into the Agricultural Produce Marketing Committees’ yards. Along with this, except cement, steel, pharmaceutical and FMCG goods, dispatches have seen a drop of 8-10 per cent from auto components/parts, hardware items, tiles/marbles, sanitary items, furniture and fixtures, motor vehicles, steel moulded products, consumer durables, electrical goods, stationery items and general merchandise.
The maximum hit is the small and medium enterprise sector, which provides almost 70 per cent of the cargo from the entire manufacturing sector to the truck transport business.
The August period has entered a crisis-like situation for truck transporters in comparison to the same month in the last two years as trucks at the leading transport centres are waiting for at least four-five days to get the return loads to their base station because of lower cargo availability across the segments. If the freight market does not improve in the next couple of months, there is every possibility that repossession of delinquent trucks may enter an uncertain phase similar to 2009, the report said.
Due to the sluggishness all round, the current ground level situation point towards a stress in the system. Most of the fleet owners are pinning their hopes on an improvement in the truck freight market during the forthcoming festival season, which may increase consumer spending and improve the business climate.
However, at a micro level, there are no visible signals to suggest that the truck freight market will go in for any mentionable upswing in the third quarter of the current fiscal, the report says.