[Ripcord09]

Economists may not tell you this, but trucks can reveal a lot about economic activity. Simply put, when truck sales and rentals are high, it usually means that businesses are gearing up for higher demand. Goods are moving, production is ramping up and logistics are in full swing. And with increased demand for logistics, truck rentals rise. On the flip side, when rentals drop, it’s often a sign that business is sluggish.

Truck rentals are climbing. In December 2024, hiring a truck from Delhi to major cities like Mumbai, Chennai, Kolkata or Hyderabad and back cost around ₹1,78,000 on average. In January 2025, that figure rose by 3% to ₹1,83,000.

The ongoing Maha Kumbh alone has driven five times more trucking activity than in 2013. FMCG giants like Dettol, Dabur, PepsiCo and Coca-Cola see a massive marketing opportunity and are flooding the event with product samples. And with distributors in the region already reporting anywhere from a 2x to 10x jump in business, truckers have every reason to keep their rates up.

Rising rentals also reflect that agricultural activity is looking strong. In places like Kolkata, there was a seasonal uptick in the transportation of winter vegetables and fruits. And while that may be a one-off event, truck rentals have been rising for two other key agriculture-related reasons.

Trucks also offer insights into manufacturing and infrastructure trends. Take logistics businesses which are highly sensitive to fuel prices. If truck rentals rise because of expensive fuel, it suggests that businesses are willing to absorb those costs because demand is strong. And that also means healthy manufacturing on the horizon.

Unlike GDP or unemployment data, which are reported after a certain period (or as we saw, lagging indicators), truck rental prices fluctuate as per the market rate that’s based on the ongoing supply and demand trend. And this makes them an early warning sign of economic shifts or what we call ‘leading indicators’. They tell us where things might be moving instead of making sense of what has already happened.

Truck rentals and sales could also send confusing signals at times. Take 2018, for instance, when truck sales soared and quarterly sales for most truck manufacturers rose by as high as 40% year-on-year. But at the same time, truck rentals kept falling after the festive season.

Rentals can also be highly sensitive to sudden changes in government policies or economic disruptions, making them volatile indicators.

While high-end economic indicators get all the attention, sometimes all you need to do is watch the roads. An empty truck, an idle fleet or a spike in demand — they all might have a story to tell about the economy.

So, what do you think? Can we rely on truck activity as a reliable economic indicator, or is it just one piece of a much larger puzzle?

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[v1p3r]

Very interesting, and thank you for sharing.

[saket77]

That can well explain the goods part of the economy. However to solve the entire puzzle, we need a good indicator for the services part as well since the GDP includes both goods and services.

[SmartCat]

I think analysts come up with sales of random items as an indicator of business/GDP growth. Other examples:

- Ship rates/rentals as an indicator of World's GDP growth
- Sulfuric acid sales as an indicator of GDP growth
- Copper sales as an indicator of GDP growth
- Men's underwear sales as an indicator of GDP growth
- Increase in power capacity of a country as an indicator for GDP growth
- McDonald's sales as an indicator of US GDP growth

and so on.

[Hayek]

Truck sales reflect the change in economic growth rates relative to expectations. Remember that truck usage is a population variable - so if the rate of economic growth rises, the population of trucks needs to rise faster than normal and truck sales shoot up. But even in a growing economy, if the rate of growth falls, truck sales can fall sharply.

Truck rentals (if one adjusts for the noise) are probably a better leading indicator of GDP - to the extent GDP arises from trade in goods. But today, services account for over 50% of GDP in India - and truck sales or rentals have no correlation with what is happening in that sector. So yes, truck sales and rentals were good indicators in the past - but are less real indicators as an economy develops.

[V.Narayan]

Sales of trucks to some extent are a early lead indicator of an uptick in economic growth or expectation of economic growth. Similarly slowdown of truck sales is an early indicator of the opposite. This we used to look for even in the 1980s when I sold Tata trucks.

Payload transportation rentals too are a rough indicator but there are so many variables that could move rates in the short term that they are not as accurate an indicator as actual sales of trucks. However there is a subset of renting an empty truck, a sort of a dry lease, in order to transport goods and those rentals reflect economic outlook very well and rise before GDP growth rates rise and fall before GDP growth slowdowns. This daily rent of a dry lease of a truck is a very sensitive indicator of when trade & commerce start to move up. While services are 50% or so of our economy service sector also purchases physical goods that need to be moved albeit not to the same volumes as the manufacturing sector.

- Old ex-truck salesman

[NiInJa]

I am not sure if it can be termed as an economy indicator, but in rural Maharashtra where agriculture (and its related activities) is main source of income, good times usually mean people buying pickup trucks/small tempos for their business. Many don't indulge in buying luxury cars but instead will get a CNG Wagon-R or Eeco and put it on rental as a side business.

[1.2TSI7DSG]

Originally Posted by Ripcord09

So, what do you think? Can we rely on truck activity as a reliable economic indicator, or is it just one piece of a much larger puzzle?

In India, truck activity (assuming the rental/trips and not just sales), is dependent on two major factors:

1. The seasonality in production (especially agri)
2. Availbility of goods trains

For most of the time the total goods movement can be taken as a ref, but just trucks may paint a wrong picture, considering the import bill for the fuel etc.

[volkman10]

Miles To Empty: India's trucking sector signals economic drag.

A dip in demand for freight haulage reflects broader uncertainties in the nation's growth trajectory.

the rumble of diesel engines across India's vast highway network has long been a reassuring indicator of economic vitality. But a recent dispatch from Shriram Mobility, attuned to the pulse of the transportation sector, suggests a deceleration.

Truck rentals, a bellwether of goods movement, are displaying an uncharacteristic sluggishness, mirroring a wider recalibration of economic expectations. This dip, attributed to a confluence of factors—general slowdown in industrial activity, tepid infrastructure demand, and the perennial caution of the fiscal year-end—paints a picture of muted momentum in Asia's third-largest economy.

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