The Indian Competition Commission has directed the Association of Trailer Owners in Chennai to stop demanding an unsustainable tariff and set limits on the number of trailers that can be operated by container transportation stations, saying the decision is the same as anti-competitive behavior.
The July 20 order follows the submission by Chennai Chapter from the National Association of Container Freight Station on the decisions taken by the trailer owner.
The trailer owner has set a 20 trailer limit that can be owned and operated by each container transportation station (CFS). They also forced the tariff of goods that were not sustainable at CFSS, which is an important constituent of a complicated logistical supply chain in the manufacturing process.
According to Avnash Iyer, chairman, southern region, the Association of National Container Transportation Station, CCI’s order justifies their position and the current responsibility is on the authorities to implement it in the field.
“Free prices are the right to import and exporters,” said Iyer. “Free markets must be allowed to determine the level of goods.”
Chapter Nacfs Chennai has 32 members.
Some trailer owners said they did not know CCI’s orders. When given a briefing about the contents of the order, they said they would wait for their lawyers to advise them in the field to follow.
Reduce costs
However, experts say they are not sure of the direct impact that CCI orders will have on the operating ecosystem. Although investing is not a challenge for any CFS, the ecosystem around the logistics business in Chennai is not yet mature, the executive of the industry said.
Iyer said there was a time when the Chennai port was full of infrastructure problems and the settlement time was longer and, as a result, the tariff of goods was higher. However, infrastructure in the Port of Chennai has increased and additional ports – one in Ennore and the other in Kattupalli – have appeared nearby.
According to Iyer, trailer transport tariffs in Chennai are much higher than those in the ports of Nhava Sheva and Mundra.
We talk about reducing logistics costs. Every rupee pinches the producer/exporter, “said Iyer.
In the dynamics of a developing market, Iyer said logistics players have a serious responsibility to ensure that there is no advantage of the windfall fortune.
Trailer owners have increased tariffs for 20 feet containers and 40 feet.
There are no poems or reasons for their actions,” said an industrial official, refusing to be identified.
If the state government is serious about investor-friendly claims, it must really do something to uphold CCI orders strictly,” said a CFS ranking official here.
This is for the first time someone stands beside us against irrational practices,” Iyer said, referring to CCI.
The Director General (DG), in his report to CCI, said that the price increase was forced on CFSS for the threat of strikes and actual attacks.
“DG also observes that price increases do not have a correlation with the increase in fuel prices, insurance, reserves, tires, repairs and maintenance, driver salaries, etc.,” CCI said in his order. “Different CFS lies in different locations, some in 10 km from the port and others exceed 50 km from the port and in this scenario, to have the same improvement without considering the most important factor in consideration, namely distance, clearly revealed that not There is a reason in the general price increase. “
The trailer owner was given four increases between 2014 and 2019. In 2018, there were other examples of strikes and NaCFS, Chennai, decided to approach CCI to help maintain market prices for services provided by trailer operators.