But more than anything, the oversupply of vehicles, estimated around 15-20 per cent, has affected the demand. For, despite the growth momentum in the past one-year, freight rates haven't moved up. For instance, the freight for a 9-tonne payload truck between Mumbai and Delhi is around Rs 11,000. The inability to increase freight rates has affected transport economics. It has forced operators to take a closer look at their costs, and encouraged them to shift to multi-axle vehicles, which carry more load.
Operators can optimise their diesel costs by moving larger loads on larger vehicles.
Indeed, transport economics in India revolve around overloading. The diesel price hike has pushed up operating costs, and the sales tax rationalisation has increased capital costs. Next year is not going to very good. This, despite attractive financing schemes.