Truck rentals across key long-haul routes remained elevated in June as higher automotive fuel prices offset subdued freight demand, according to the latest market update from Shriram Finance.
The report said rentals registered moderate month-on-month increases on several major corridors despite lower fleet utilisation, while freight movement remained constrained as monsoon activity gathered pace.
Truck rentals edge higher on key routes
Truck rentals increased by around 2% on the Mumbai-Kolkata-Mumbai route during June, while the Delhi-Kolkata-Delhi corridor recorded a rise of about 1.7%. Rentals on the Delhi-Bengaluru-Delhi route also increased by nearly 1.8%.
Other routes, including Delhi-Mumbai-Delhi, Delhi-Hyderabad-Delhi, Delhi-Chennai-Delhi, Mumbai-Chennai-Mumbai and Guwahati-Mumbai-Guwahati, also witnessed modest gains.
However, rentals on the Bengaluru-Kolkata-Bengaluru and Bengaluru-Mumbai-Bengaluru routes remained largely unchanged, indicating softer freight demand across some southern corridors.
On a year-on-year basis, trucking activity remained resilient, led by the Delhi-Kolkata-Delhi route with growth of around 15%, followed by Bengaluru-Mumbai-Bengaluru at approximately 11%. Mumbai-Chennai-Mumbai and Delhi-Mumbai-Delhi also posted annual growth of about 7-8%.
Commercial vehicle trends remain mixed
Vehicle sales presented a mixed picture during June. Bus sales rose around 24% month-on-month, while agricultural tractor sales increased by approximately 18%, supported by seasonal demand ahead of the Kharif sowing season. Commercial tractor sales and earthmoving equipment also recorded gains of around 10% and 12%, respectively.
In contrast, passenger car sales declined by about 2%, while e-rickshaw sales fell 3% sequentially.
On an annual basis, goods carrier sales grew approximately 21%, passenger car sales rose 28%, and three-wheeler goods vehicle sales surged around 42%, reflecting continued demand across logistics and personal mobility segments.
Electric vehicle adoption gathers pace
Electric mobility continued its strong growth trajectory in June. Sales of electric two-wheelers increased by around 13% month-on-month, while electric three-wheelers rose by nearly 10%, driven by growing adoption in commercial transport and last-mile delivery.
Compared with the same month last year, electric two-wheeler sales jumped about 91%, while electric three-wheeler sales more than doubled with growth of approximately 103%.
Fuel consumption and FASTag volumes decline
The report noted that petrol consumption fell around 3% month-on-month during June. FASTag collections also declined, with transaction volumes down approximately 3.6% and collection value slipping 1.3%, indicating lower highway traffic and freight movement compared with May.
The industry expects pump prices to soften in the coming weeks as international crude oil prices ease, which could provide some relief to fleet operators.
Trucking activity may remain range-bound
Shriram Finance Joint Managing Director & Chief Operating Officer – Commercial Vehicles Sudarshan Holla said truck rentals remained elevated due to higher fuel prices even as freight demand continued to remain subdued, resulting in lower fleet utilisation across the industry.
He added that with monsoon activity gathering pace, trucking activity is likely to remain range-bound through July. Holla also noted that the logistics industry is awaiting the government’s decision on the operation of pre-BS VI trucks in the National Capital Region during the November-March period, as the policy could have significant implications for fleet deployment and freight movement in one of India’s largest logistics markets.