CHENNAI: The unstoppable spiralling of fuel cost, particularly diesel, is taking a heavy toll on private transporters operating buses and trucks as they incur huge losses. Over nine months, the price of diesel has shot up by about Rs 15 and it hovers around Rs 78 now. The more the transporters’ fuel bill bulges, the more their burden and liabilities rise.
The skyrocketing fuel cost has resulted in increase of 25 per cent operation costs for truck operators. They are finding themselves caught on a sticky wicket because they can’t raise freight tariff to offset the rise in operation costs.
“The rise in diesel price has been dealing a big blow to the goods carrier sector. The operation costs have gone up by 25 per cent but we are not able to increase the freight tariff as the clients cannot afford it,”
P V Subramani, proprietor of logistics firm Car Carriers, told Express.
So is the case with private bus operators in the State. When diesel was sold at Rs 63 per litre, the fare in private buses was revised to 58 paise per km in January early this year but now the diesel rate has shot up to Rs 78. According to ‘Jothi’ V Kuppusamy, president, Namakkal District Bus Operators Association, “The government effected a revision of the fare for private buses to 58 paise per km from 42 paise in January this year. However, the price of diesel has increased by Rs 15 per litre now. This is causing us
big losses.”
If a bus consumes 120 litres of diesel a day, the operator has to shell out around Rs 2,000 extra for meeting the fuel costs when compared to the rate in January, he noted.
The unbridled rise in fuel costs is having an overbearing impact on the sector as smaller fleet owners are finding it very difficult to sustain their business and have been pushed to the point of crisis.
Many fleet operators are left with no other option but to dismantle their vehicles despite suffering heavy losses as they feel the business is no more profitable. C Dhanraj, secretary, State Federation of Lorry Owners Association-Tamil Nadu (SFLOA-TN) says, “Small-level truck operators are not able to continue with the operation of their vehicles. So they are towing their trucks to scrap.”
He informs that several goods carriers are being dismantled every year in Tamil Nadu. Industry sources say that the future looks bleak for small fleet operators as their financial liabilities continue to pile up, leaving them on the verge of bankruptcy.