Taking advantage of the fuel price hike, truck operators have increased rentals for standard 9-tonne truck by as much as 12-13 per cent. The diesel price hike warranted a rise in rentals of just 3 or 4 percent, according to estimates.
A Delhi-Kandla-Delhi truck trip priced at Rs 46,600 before the price revision has now jumped up by almost Rs 5,000, before cooling to Rs 2,300—a 7 per cent rise against a 3 per cent rise in costs.
According to a Road Transport Ministry estimate, heavy goods vehicles consume about 6 km per litre of fuel on highways and 4 km in cities. Truck rentals impact retail prices of fruits and vegetables because almost 80 per cent of these commodities is transported by trucks, thus paving the way for inflation.
The estimate by the Indian Foundation of Transport Research and Training (IFTRT), a Delhi based transport tracking organization, shows that it is the truckers’ unions which have jacked up rentals after the fuel price hike. It adds that many retail booking agents or retail goods transport firms "have advised them (the owners) to inject a steep increase of 8 per cent to 10 per cent retail freight hike." "The goods booking agents/retail transport firms are going to be the real beneficiaries of this hike since they have a direct interface with consignors and traders who normally provide cargo to these goods booking firms," IFTRT said.
The Foundation further stated that the biggest losers from this hike by booking agents and retail transport firms would be the small and medium enterprises (SMEs) which have very limited bargaining power on retail parcel booking freight charges with goods booking transport agencies. The sharp rise in prices could not be sustained because of stiff resistance from consignors and big transport firms hiring trucks, along with increased availability of trucks, it was pointed out.
Between November 2009 to April 2010, truck rentals across the country have risen by 21 per cent to 23 per cent due to strong demand, limited availability and large-scale diversion of trucks for transporting wholesale products like grains and sugar. "Riding on the quantum jump in cargo offerings and shortage of trucks in the last seven to eight months, truck rentals have been overpriced in comparison to the increase in input cost till May 2010," IFTRT said.
Source: Exim News Service, New Delhi, 08 July 2010