Increasing truck rentals spell strong eco revival

CHENNAI: Truck rentals for the week-ended January 4 have hit a two year high on the back of double digit manufacturing growth and uptick in exports.
According to the Indian Foundation of Transport Research and Training (IFTRT), the rental per round trip for a 9-tonne payload between Delhi and Mumbai was Rs 38,700 on December 5, it shot up to Rs 41,700 on January 4.Two years back on January 4, 2008, the rate was Rs 35,700.
Similarly, the rental stood at Rs 63,500 between Delhi and Chennai on December 5,2009, while it was at Rs 65,500 on Jan 4, compared to Rs 60,000 on Jan 4, 2008.
"There is a spurt in despatches as companies have a target to meet their year end despatches target. The market rates have gone up because of this reason. There has been 6-7% growth in some regions, while there has been about 10% growth in a few places. Even the FMCG market is good at the moment," K M Narasimhan, former president, Chennai Goods Transport Association, told The Times of India.
The idle capacity of truck fleet on trunk routes has been consumed in Oct-Dec quarter with sustained increase in cargo demand. Truck rentals have gone up by 20-25% and the freight market is witnessing a growth of about 8%, according to IFTRT.
Narasimhan differed on this, "Freight rates have not been good for a long time. There is idle capacity and shortage of drivers and only 60-65% utilisation of vehicles."