Relief for road transporters as capacity utilisation rises

Mumbai: Capacity utilisation for road transporters in August has improved to more than 60%, as economic activity gathered pace and commercial vehicle traffic on highways reached 80-90% of the pre-Covid times.Transportation of goods such as agricultural produce, FMCG, pharmaceuticals, iron ore and ecommerce consignments aided the upwards trend. Demand to carry automobile components, two-wheelers, cement and steel is also gradually improving.Capacity utilisation for road transport companies has been improving month-on-month since falling to around 30% in May, but there is still a long way to go to reach normalcy, transporters said. “The situation is slowly improving. Right now, there is about 60% capacity utilisation across the country and it could go up to 80% during Diwali,” Chetak Logistics director Sachin Haritash said.The demand recovery was not evenly distributed across the industry. Operators who own 1-10 vehicles are worse off than their larger, organised counterparts. Small operators are generally attached to larger transporters and rely on them for receiving consignments.“In a scenario where demand is subdued, large fleet operators are prioritising own fleet utilisation over small fleet operators,” Crisil Research director Ajay Srinivasan said.

from Economic Times https://ift.tt/2QwI3df