Truck rentals up 5% in March, utilisation levels remain flat as fuel price hike starts to pinch

Chennai: The transportation sector is beginning to feel the pinch of fuel price hikes with fleet utilization levels staying flat and truck rentals going up in March. Truck rentals in March have gone up by 4-5% on trunk routes, even as diesel prices are up by nearly Rs Six per litre, says the Indian Foundation of Transport Research & Training.
Trunk route round rates have gone up by Rs 5,000- Rs 9,000 between March 1 and April 1 partly riding on agri dispatches following the summer crop harvest. According to a latest report by Crisil Research, sectors like cement and coal mining are seeing improved utilization, whereas auto carriers and petroleum tankers have remained flat in March.
Utilisation levels have been hit by price hikes in sectors like FMCG and automobiles. “Consumer durable companies will also start taking price increases as the crude and raw material pinch gets worse,” said Hemal Thakkar, director, Crisil Research. “Accordingly consumer linked non-discretionary products or low-ticket consumer electronics segments will face a challenge. Consumption sectors such as FMCG, fast moving consumer durables and textiles, would find it difficult to pass on the incremental cost to end-consumers.”