Waning dispatches by small and medium enterprises (SME) has taken its toll on truck rentals for the last two months.
According to a report by the Indian Foundation of Transport Research and Training (IFTRT), truck rentals on trunk (long-distance) roads have slumped between seven and nine per cent in April and May following a 15 per cent decline in cargo flow from the SME sector.
Overall, cargo flow from the manufacturing sector has seen a 10 per cent drop, thereby, impacting rentals, the report said.
Currently, ‘cargo offerings from SMEs as compared to large manufacturing units appear to be performing negatively'.
“In the present circumstances, there seems to be very little hope that truck rentals will recover before September 2012”, the IFTRT report says.
According to the IFTRT report, “the increase in compensatory load from wheat procurement, increased arrival of mango and other summer fruit and vegetable crops has not been enough to stem the decline” in rentals.
However, with fast moving consumer goods (FMCG), textiles and the electronics goods sectors maintaining their volumes through road cargo offerings; truckers have survived the tough business environments.
Truck Sales
There has also been a meagre growth in medium and heavy truck sales as truck-owners opted for adding more high tonnage (larger capacity) trucks over the last two-and-a-half years.
According to IFTRT, since October 2009, ‘the high tonnage truck fleet expansion went up by 25 per cent.