Published Date : 15 May 2023
The global last mile delivery transportation market revenue is expanding at USD 217.64 billion in 2023 and is expected to attain around USD 424.3 billion by 2030, poised to grow at a remarkable CAGR of 10% between 2022 and 2030.
The main drivers for the development of the last mile delivery transportation market are the growing use of e-commerce platforms and the integration of innovative technology.
Last-mile delivery is a rapidly developing but difficult aspect of logistics and transportation. Better last-mile support in transportation management and storage is essential since last-mile delivery can account for up to 30–35% of the overall delivery cost. All forms of transportation rail, road, air, and water have seen a growth in the importance of last-mile delivery.
To improve last-mile service, long-standing freight carriers are introducing or upgrading technologies. The emphasis is on optimizing the customer experience, lowering waste, boosting dependability, and raising the overall competitiveness of the transportation ecosystem.
This delivery system's major objective is to deliver the requested goods and services to the customer's requested location within the specified time period, at the specified fee, and in excellent condition. Also, the last-mile delivery industry is advanced and is expected to soar in the near future. The last mile logistics are currently receiving greater attention from consumers and merchants, which will help them stand out in the market. Also, Amazon Prime has evolved into an online retail distribution channel where customers may get the requested items and services in a certain amount of time and in good condition.
With a market share of more than 72% in 2022, Asia Pacific was the largest last-mile delivery transportation market. More than half of the world's population lives in Asia and the Pacific, creating a vast market. Rapid urbanization increased disposable income, a hectic lifestyle, expanding internet penetration, and rising smartphone use are a few of the key macroeconomic drivers driving the expansion of the last-mile delivery transportation industry in the Asia Pacific.
It is anticipated that North America would expand significantly throughout the projection period. A few of the key drivers of the expansion of the North American last-mile delivery transportation industry are rising purchasing power, better access to digital technologies, increasing internet penetration, and rising smart device use. Due to the conveniences involved, the strong demand for the items combined with the busy and hectic schedules of the consumers is driving up demand for last-mile delivery transportation services.
Last Mile Delivery Transportation Market Report Scope:
|Market Revenue in 2023||USD 217.64 Billion|
|Projected Forecast Revenue in 2030||USD 424.3 Billion|
|Growth Rate from 2022 to 2030||CAGR of 10%|
|Largest Market||North America|
|Forecast Period||2022 to 2030|
|Regions Covered||North America, Europe, Asia-Pacific, Latin America, and Middle East & Africa|
The logistics firms have been on the front lines since the Covid-19 epidemic broke out, with fully supplied warehouses and active trading. The disruption of the worldwide supply chain brought on by the mostly globalized shutdown, however, further restricted the expansion of the product trade in the aforementioned logistics industry. Yet, one aspect of this Covid pandemic that stood out in particular was the enormous rise of the e-Commerce industry, which introduced customers to digital business models and efficient and secure logistical practices. With the growth of Covid-19 instances globally, there has been a noticeable surge in the quick or same-day delivery trends for online purchases. Customers feel secure placing online orders and having them delivered right to their door rather than going to a busy location.
Market Drivers: Growing trade activity and growing attention to seamless transportation activities
Globalization is primarily fueled by changing market circumstances and an expanding world economy. Due to the rise in globalization during the past few years, various trade-related activities have been shown to expand. Also, the expansion of the global market is a key driver supporting the industry's success. In the upcoming years, trade activities between cities and close-by nations are expected to boost market expansion for last-mile delivery.
In order to help manufacturers and retailers that find it challenging to effectively monitor transportation activities, such as storage, distribution, and fulfillment services, freight transportation firms provide them with support. Globalization is predicted to fuel the expansion of the last-mile delivery business by increasing trade activity and raising concerns about efficient transportation.
Market Restraints: Corruption in the supply chain and lack of transparency
One of the main obstacles in this world is corruption, which has affected almost every industry, including the worldwide market for last-mile deliveries. The complete supply chain, from SKUs, stock allocation, and dispatch through delivery, is involved when a product is ready to be transported from the distribution center to the end user. As there is a significant chance of buyer fraud, which is defined as unethical action on the part of the final consumer after the sale, lack of transparency is a growing concern for online merchants. This includes customers who insist on a refund or a replacement right away despite having used multiple channels to purchase the item and alleging it was never delivered.
Market Opportunities: New technologies and cross-border delivery
With start-ups moving beyond drones and robots, investment in advanced technology solutions powered by AI, IoT, big data, and blockchain is on the increase. For instance, the Data Roots Labs research highlighted Cargofy1 as one of the leading companies introducing AI to the logistics industry2 with a focus on emphasizing improved engagement and connection in freight transportation. Cargofy is a US-based AI-powered logistics service provider (company).
Shippers and carriers worldwide are investigating ways to strengthen the supply-chain networks that underpin international shipment and delivery. In light of the fact that in Western Europe, cross-border orders made up around 26%3 of e-commerce sales in 2019, Europe has emerged as an area with significant potential. A prominent logistics provider recently increased the scope of its last-mile operations across Europe4 by creating hubs in the UK, the Netherlands, and Ireland, and Spain.
The e-commerce industry's adoption of autonomous last-mile delivery services depends critically on technological developments in autonomous cars. For instance, prominent competitors in the e-commerce sector like Amazon and Alibaba have poured billions of dollars on their own supply chains with the promise of delivering goods more quickly. Amazon made a $1 billion investment in its Prime subscribers' one-day delivery program in 2019. In a few of cities, Walmart and Target Corporation also provide same-day delivery services.
In 2022, the market for last-mile delivery transportation was dominated by light-duty trucks. The substantial proportion represented by the light-duty vehicles category is mostly due to reasons like low cost, higher cargo room, high speed & flexibility, and other advantages. Due to their quick delivery times and affordable operating costs, drones and automated guided vehicles (AGVs) are expected to rise rapidly throughout the projected period.
In 2022, the dry goods sector accounted for a sizable portion of last-mile deliveries worldwide. A leakage-proof vessel is needed to carry these sorts of commodities, which raises the cost. Chemicals, oil, alcohol, and other goods in liquid form have restrictions on distribution and transit in some countries.
Major Key Players:
By Vehicle Type
By Cargo Type
By End Use
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