The heatwave, delayed monsoons, elections, coupled with high interest rates led to stress in rural hinterlands impacting logistics sector in June 2024, according to Shriram Finance Ltd.

Providing details on the current status of the automobile and logistics sector, Shriram Finance in its July 2024 bulletin said that passenger vehicle sales experienced a notable decline of 6.77% YoY. Motor car sales declined by 9%.

Truck rentals degrew by 2.6% on the Mumbai-Kolkata-Mumbai route but saw a 4.1% increase on the Kolkata-Guwahati-Kolkata route.

Sales of used commercial vehicles grew on a YoY basis, with a rise of 7% for 7.5 to 16-ton capacity vehicles and 43% for 31 to 36-ton capacity vehicles.

FASTag toll collections rose by 2% in volume and 7% in value on a YoY basis.

The slowdown across sectors including road transport, vehicle sales appears temporary, given that the new government is in place and with monsoon rain expected to gain strength, said its MD & CEO Y.S. Chakravarti.

Businesses are hopeful that policy action from the government will help push economic activity into a higher orbit, he said.

Shriram Finance also believes that the ongoing kharif season could boost the sales of agricultural, trailer and commercial tractors.