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A truckload of problems

Raja Simhan T. E.

THERE are more than 30 lakh trucks in the country, of which around eight lakhs are light commercial vehicles (LCV). There are more than 70,000 transport companies engaged in the business of collecting, transporting, storing and delivery of parcels.

Further, there are thousands of intermediaries to book business and settle freight rates, based on the supply and demand of trucks in the market. There are around 50,000 transport contractors for handling and organising transportation of bulk cargo.

Over two-thirds of the goods transported in the country are by trucks. And this share, vis-a-vis the Railways, has steadily increased over the years. No other sector is so vital to the economy as the truck industry is.

Despite all this, the truck industry, which was recently given industry status, faced multiple problems, the most important being that of over-capacity and aging vehicles (some are more than 15 years old). ``The non-availability of goods for movement has pushed us to the brink,'' is the common refrain of truckers in Namakkal, the `auto nagar' of the South.

Says Mr P. Sengodan, President, All-India Motor Transport Congress (AIMTC), the apex body of all road transport organisations in the country: ``There is 20-25 per cent excess capacity of trucks vis-a-vis the cargo available for movement, with the result that a large number of vehicles idle at many places.''

Mr Sengodan, who is also President of the Namakkal-based State Lorry Owners Federation (SLOF), is worried because the gap between availability of trucks and that of cargo has been widening in the last couple of years. Further, as he points out, the compa nies have become conscious of having an effective logistics solution in place, and, therefore, insist on just in time (JIT) delivery by vendors to cut down on their inventories.

Some of the companies, instead of engaging/leasing trucks from third party operators, prefer to have their own fleet. While this reduces costs for the company, it affects the truck industry, he says.

The emergence of a number of logistics companies, both domestic and multinational, in the past few months, too, is posing a stiff competition to the truck operators as these companies offer end-to-end solutions. ``We cannot compete with big logistics com panies. We can only offer our vehicles on lease, to them. However, many of the logistics firms prefer having their own vehicles, than leasing,'' says a trucker.

So, what is the solution? Answers Mr Sengodan: ``The Government should reduce the number of licences issued per year till the market stabilises. We have been emphasising this to the government for a long time. But nobody listens.'' But, then, it may not be easy for the government to restrict the issue of fresh licences, as vehicle manufacturers will be opposed to any such move. ``But the government has to act urgently to save the truck industry,'' he says.

Lamenting the government's indifference towards the plight of the truck industry, the AIMTC President emphasises the need for regular interaction at the government level, involving the road transport operators, the government, vehicle manufacturers and v arious associations to sort out the relevant issues.

For the truck industry, as it is pointed out, the presence of old vehicles on the roads is another matter of concern. One can still vehicles of the Second World War such as Fargo and Bedford on the roads, carrying sand, coal, and even milk. It is estimat ed that over 25 per cent of the trucks on the roads are more than 15 years old.

``Says Mr Sengodan, ``We have been pleading with the government to ban vehicles of more than 15 years old. These vehicles, which are poorly maintained, are not only the bad polluters, but also restrict the demand for new vehicles.''

The experts, according to road transport sources, have suggested amendments to the Motor Vehicles Act such that the issue of fitness certificate (FC) becomes mandatory, initially after 10 years, and subsequently, after every five years for all categories of non-cargo carrying vehicles.

In the case of cargo carrying vehicles, which constitute a major chunk of the vehicle population, the annual renewal should be made mandatory.

In India, the demand for new vehicles is generated only if there is increased cargo movement. In contrast, the demand in developed countries is created out of new additions and to a large extent by replacement of existing vehicles.

In developed countries, the average life of a commercial vehicle will under no circumstances exceed 15 years. The strict emission norms ensure that the old vehicles are scrapped. In India, there is no such stipulation.

As Mr Sengodan points out, ``On the one hand, the government is emphasising freedom from pollution and, on the other hand, allowing the old vehicles to ply on the roads, polluting the atmosphere. The government is exploring means to manage the increasing oil pool deficit, but no action is being taken to stop the aging vehicles, which guzzle diesel.''

According to Mr M. K. Janardanan, Secretary, Chennai Goods Transport Association (CGTA), ``Unless old vehicles are phased out, the truck industry will not survive in the long run.'' Fixing age norms for trucks, it is pointed out, will not only reduce the level of pollution, but also boost the sale of commercial vehicles. Even the freight rates would firm up. At present, the freight rate is the same for both old and new vehicles, he says.

The new vehicles cost a lot of money, and at the same time, their maintenance cost is stiff and the levies are prohibitive. Truck owners cannot hope to recover the investment of around Rs 8 lakh in 15 years when the return, in the sluggish market, is onl y around Rs 10,000 per month. A substantial portion of the earning goes to make loan repayment. As a result, the trucker is forced to run the vehicle for more than 15 years to make best out of the present situation.