Fleet utilization soars to 90% amid pre-festive stocking: Shriram Mobility
Truck rentals, a key barometer of goods movement remained firm in September as pre-festive stocking continued across India. Freight rates held firm without much increase as fleet utilisation levels surged to 90%, the highest in recent times from 70%, said Shriram Mobility Bulletin published by Shriram Finance Limited, the flagship company of the Shriram Group.
According to the bulletin, “Truck rentals in the Bengaluru-Mumbai-Bengaluru route saw the highest increase at 1.6%, while the Kolkata-Guwahati-Kolkata route remained unchanged. The Delhi-Bengaluru-Delhi and Delhi-Mumbai-Delhi routes also recorded moderate growth, with increases of 1% and 0.7%, respectively.”
The approaching festive season demand for more commercial vehicles resulting in the sales of new Commercial Vehicles is reflected in the fact that sales of Goods Carrier, e-Rickshaw with Cart and Three-Wheeler (Goods) showed an upward trend. The increase in sales of Construction Equipment Vehicle (Commercial) and Earth Moving Equipment signals a post monsoon boost in infrastructure development activity.
Y. S. Chakravarti, MD & CEO of Shriram Finance Ltd., said, “Positive outlook ahead of the festive season is driving goods movement, with fleet utilization levels hitting 90%, the highest we’ve seen in recent times. However, truck owners caution that an increase in freight rates is imminent as tyre prices and toll charges have risen in the past few weeks. The fleet operators are also seeking a cut in fuel prices, which could blunt any freight rate increase. We anticipate the upcoming festive season will provide a much-needed boost for passenger vehicle sales.”
In the used commercial vehicle (UCV) market, the prices of 1.5 to 2-tonne category registered a 21% year-on-year (YoY) increase, followed by a 12% rise in the 7.5 to 16 tonne category. However, the 16 to 19 tonne category experienced a 16% decline.
In the Used Passenger Vehicle prices, Maruti Baleno and Maruti Dzire registered positive sales growth of 8% and 7% (YoY) respectively while other segments continued to face downward pressure. The same held true for Used Two-Wheeler Sales as well with a decline across most brands.
In the new Passenger Vehicles sales, Motor car sales saw a decline of 14% on MoM basis (20% decline – YoY) and two-wheeler sales saw a decline of 10% on MoM basis (8% decline – YoY) in September 2024. This could possibly be attributed to a wait and watch stance by potential buyers and the upcoming festive season is expected to drive demand across both segments.
The woes of the EV segment seem to be continuing despite the various initiatives introduced by the Government to boost sales. “Buyers seem to be taking a cautious approach, and this is seen from the fact that sales of two-wheeler EVs have declined by 23% (MoM) and 44% (YoY) and four-wheeler EV sales registered a 31% (MoM) and 43% (YoY) decline,” the bulletin reveals.
In September 2024, petrol consumption decreased by 6% month-on-month, while diesel consumption dropped by 2%. Although Fast-tag volumes declined by 3.2%, overall toll revenues increased due to higher toll charges. E-way bill generation remained flat month-on-month in August 2024 but posted a 13% increase year-on-year.
As the Indian economy gears up for the festive season, the trucking industry is poised for further growth, driven by increased demand and improving market sentiment.
