• Sanjay Darshan

How Covid-19 impacted the Moving industry? (updated 2022)

Updated: Apr 6

COVID-19 has impacted global industry including Moving & Logistics.

Transportation along with retail, restaurant and travel is one the majorly effected due to break of Covid 19 and its after effects. Logistics industry is part of every supply chain management, local deliveries within neighborhood or international supply chain management systems involving multiple continents. At the advent of COVID-19 lock down across nations, countries like India came to a virtual standstill with hardly any economic activity. Transportation, Logistics and moving industry involved is transportation, warehousing and distribution of goods has been directly effected by COVID-19 pandemic and that disruption will have long term effect in viability, competitiveness, economic growth and job creation in this sector.


MOVING INDUSTRY BEFORE COVID-19

Transportation industry is majorly divided into 3 verticals mainly Aviation , Road and Railways. While Aviation and Railways are highly dependent on govt policies, Road transport is more market and socioeconomic driven although present Indian govt's focus on infrastructure investment thorough public investment and private partnership gives a big boost to transportation industry. On the flip side, the low GDP growth over last few years and high fuel prices have effected the industry growth and transportation volumes haven't reached in Jan 2020 levels yet in Aug 2021. In developed economics, Logistics contribute upto 25% of GDP while India has a 6.8% of its GDP contributed by Logistics and transportation. This suggests a huge growth opportunities for Logistics in coming decades and better efficiency in this sector can boost competitiveness and improve bottom lines for the industry in emerging markets.


COVID-19 IMPACT ON LOGISTICS INDUSTRY IN INDIA

As the govt announced the complete lock down in March 2020, almost all economic activity came to a abrupt halt and so did the logistics industry. More than the halting of operation, the lock down resulted in truck being halted mid-way, cargo was backlogged at warehouses and ports, contracts cancelled and payments unrealized, bank loans on trucks to be paid to avoid default, lack of manpower etc. Travel and movement restrictions was another bottleneck. with Individual states having difference interstate movement guidelines. The lock-down also created a huge shortage of truck drivers since the unpredictability about COVID-19 situation led to mass movement of labor to their native location which resulted in over 50,000 containers piling up in the ports of Chennai, Kamajarar, and Kattupa.

https://www.thehindubusinessline.com/economy/logistics/over-50000-containers-stuck-at-3-major-ports-in-chennai/article31263262.ece



Trucking & Logistics in Indis Post Covid. Disruptons, opportunities and growth prospects in 2021. Moving Industry in 2021.
COVID-19 impact on Logistics & Moving in 2021

Another major setback for logistics in India is the increased input cost including high fuel prices. The fuel prices have gone up by 25-28% across the country and it has had a escalating effect on logistics. Along with direct increase in fuel cost, this also escalates the other running cost including the on-trip expenses of the drivers and other staff.


The pandemic has had a huge negative implications on the transportation industry in multiple terms and it may take a long time before the industry gains the pre Covid growth numbers.