Green Logistics Market Size, Share, and Trends 2024 to 2034

Green Logistics Market Size and Forecast

The global green logistics market size was USD 1.42 trillion in 2023, calculated at USD 1.54 trillion in 2024 and is expected to reach around USD 3.39 trillion by 2034, expanding at a CAGR of 8.32% from 2024 to 2034. The green logistics market is driven by the growing use of electric cars (EVs) in the transportation industry.

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Green Logistics Market Key Takeaways

• Asia Pacific dominated in the green logistics market in 2023.
• North America shows a significant growth in the green logistics market during the forecast period.
• By business type, the distribution segment dominated the market in 2023.
• By business type, the warehousing segment is observed to be the fastest growing in the green logistics market during the forecast period.
• By mode of operation, the storage segment dominated the green logistics market in 2023.
• By mode of operation, the roadways distribution segment shows a significant growth in the green logistics market during the forecast period.
• By end-use, the manufacturing segment dominated the green logistics market in 2023.
• By end-use, the retail and e-commerce segment is observed to be the fastest growing in the market during the forecast period.

Market Overview

Reducing the environmental impact of delivery and logistics procedures is known as "green logistics." Shippers need to do more to reduce their carbon dioxide emissions, manage trash disposal and general waste management, use recyclable products, and more, as more and more customers prefer green businesses. To reduce environmental impact, green logistics focuses on environmentally friendly distribution, warehousing, and transportation. It involves eco-friendly methods, including route optimization, driving electric cars, and effective garbage disposal. This strategy benefits firms worldwide by balancing environmental responsibility and economic efficiency.

Businesses are adopting green logistics as a strategic tool to gain an advantage over competitors and satisfy growing consumer demand. This environmentally conscious paradigm shift affects how different business processes, organizational structures, and supply chain components are configured in addition to trying to lessen its detrimental effects on the environment.

Companies are adopting green logistics techniques because of legislation that governments throughout the world are enacting around emissions, fuel efficiency, and waste management. By encouraging businesses to lower their carbon footprint and increase market adoption, these measures assist them in avoiding potential repercussions and propelling market growth for cutting-edge technologies and solutions.

Green Logistics Market Trends

Country wise initiatives towards green logistics.

Green Logistics Market Growth Factors

• Growing public concern over pollution and climate change drives demand for sustainable supply chain methods. Customers are putting increasing pressure on businesses to use green logistics solutions by favoring eco-friendly brands.
• Logistics companies are pressured to implement cleaner technology and streamline operations due to stricter environmental requirements, such as fuel efficiency standards and carbon emission limits.  This drives the growth of the green logistics market.
• Green logistics techniques enhance brand perception and draw investors and consumers who genuinely care about the environment.
• In the logistics industry, innovations in electric vehicles (EVs), alternative fuels, route optimization software, and warehouse automation increase productivity and reduce emissions.
• Companies are encouraged to invest in fuel-efficient cars and improve delivery routes to minimize fuel use by fluctuations in gasoline prices.

Green Logistics Market Scope

Market Dynamics

Drivers

Rapid advancement in the technology

IoT devices make real-time tracking of products, vehicles, and equipment possible. Sensors fastened to shipments provide live updates on location, temperature, humidity, and other factors. This openness lowers fuel usage by optimizing routes and reducing idle time. IoT sensors on machinery and cars can anticipate maintenance requirements before a malfunction happens. This guarantees that machinery operates at peak efficiency, cutting down on unneeded emissions and downtime. This drives the growth of the green logistics market.

Growing concerns regarding environmental pollutions

Consumers nowadays are more concerned about the environment and would rather support businesses dedicated to sustainability. Logistics companies are under pressure to implement green practices due to consumer preference. Sustainability is also a top priority for investors, who base their choices on a company's environmental record. Because of this, logistics companies often incorporate green logistics into their business plans to draw in and keep investors.

Restraint

Significant capital expenditures

It costs money to implement advanced IT systems for tracking, monitoring, and streamlining logistical processes. These systems are essential for increasing productivity and cutting emissions, but they come with a hefty price tag for software and hardware. Implementing automation and artificial intelligence for inventory control, route optimization, and warehousing is expensive. This limits the growth of the green logistics market.

Opportunity

Increased environmental consciousness among end-use industries

Green logistics frequently entail better routing and more energy-efficient modes of transportation. This can lower fuel consumption and increase overall logistics efficiency, resulting in significant cost savings for end-use industries. Green logistics techniques can boost operational effectiveness, cut waste, and minimize disposal expenses. Reusable packaging materials, for instance, can reduce the requirement for single-use packaging, saving money over time. This opens an opportunity for the growth of the green logistics market.

Business Type Insights

The distribution segment dominated the green logistics market in 2023. One of the most important phases of logistics management is the distribution stage. At this point, environmentally friendly modes of transportation ought to be prioritized, and logistics operations ought to be made more efficient. Using less harmful railway and sea transportation options in addition to vehicle transit is advisable.

Furthermore, environmental considerations should be considered when developing routes and packaging. Recycling and waste management are essential components of sustainable distribution plans. In conclusion, firms can lessen their environmental effect and use resources effectively by using sustainable distribution techniques and ecologically friendly logistics management.

The warehousing segment is observed to be the fastest growing in the green logistics market during the forecast period. Advances in technology have greatly improved the sustainability and efficiency of warehouse operations. Robotics, automation, and the Internet of Things (IoT) allow for improved space efficiency, energy savings, and inventory management. Warehouses can reduce their carbon footprint by implementing improved climate control systems, solar panels, and energy-efficient lighting. To lower the energy usage of a warehouse, sensors are fitted where appropriate. These consist of submeters on appliances, machines, and other equipment and motion-sensing lights. Installing sensors makes tracking and cutting energy consumption and saving costs simpler.

The materials chosen to construct or finish a warehouse may occasionally affect its sustainability. For example, non-toxic paints, sealants, wood products, adhesives, and carpets contribute to a warehouse's improved air quality.

Mode of Operation Insights

The storage segment dominated the green logistics market in 2023. Green logistics entails making the most of warehouse space for storage. As a result, there are fewer machine movements and needless activities performed by the business, which lowers the number of pollutants produced. Additionally, it makes operator work easier and expands the warehouse's storage capacity. For businesses that store at a controlled temperature, optimizing storage space also minimizes the area that needs to be kept at a set temperature, lowering operational costs and air pollution from air conditioning.

The roadways distribution segment shows a significant growth in the green logistics market during the forecast period. The road transportation industry is changing thanks to the invention and widespread use of electric and hybrid trucks. Road logistics have a smaller carbon footprint thanks to these vehicles because they produce less CO2 than conventional diesel-powered trucks. Fleet management uses telematics and the Internet of Things (IoT) to track and improve routes.

As a result, logistics operations become more environmentally friendly by using less fuel and increasing efficiency. Route optimization is a significant difficulty that allows for cost reduction with an effective route design concerning the number of customer deliveries, mileage, vehicles utilized, and the working hours of each driver. By implementing eco-friendly practices, we can calculate the carbon footprint of logistical activities.

End-use Insights

The manufacturing segment dominated the green logistics market in 2023. More and more manufacturers are working with suppliers who value sustainable practices. This entails obtaining raw materials from vendors who practice environmental responsibility and ensuring that logistics companies follow green logistics guidelines. Recyclable and biodegradable materials make reducing waste and packaging's carbon footprint easier. Integrating environmentally friendly transportation is essential to eco-friendly logistics. Businesses are adding more electric and hybrid cars to their fleets to cut pollution. Urban logistics can reduce its carbon footprint by using delivery vans driven by electricity or a combination of electricity and conventional fuels.

The retail and e-commerce segment are observed to be the fastest growing in the green logistics market during the forecast period. Customers are pressing merchants and online retailers to adopt more sustainable business methods as they grow more conscious of how their purchases affect the environment. This shift in consumer preferences pushes businesses to implement green logistical techniques.

Significantly lowering emissions is achieved in logistics through the development and use of electric and hybrid vehicles. Retailers and e-commerce businesses find these cars an appealing alternative as they become more economical and efficient. Among the few industries that experienced unheard-of growth during the pandemic is e-commerce. The widespread use of the internet, digital payments, consumer awareness, and e-commerce accessibility have all contributed to a radical change in how people shop today.

Regional Insights

Asia Pacific dominated in the green logistics market in 2023. With numerous nations pledging to pursue sustainable and green growth, the Asia-Pacific region has made notable strides in sustainable development in recent years. However, more work must be done to guarantee a sustainable future for the area. Renewable energy is crucial to mitigating climate change and reducing greenhouse gas emissions. Asian governments can stimulate investment in renewable energy by providing incentives for companies and individuals to embrace clean technology and invest in renewable energy infrastructure.

Reducing greenhouse gas emissions and advancing sustainable development require sustainable production and consumption patterns. Governments can promote environmentally friendly goods and services and pass laws allowing companies to use sustainable practices to promote sustainable consumption and production.

Green logistics has received significant support from the Philippine government through several programs and laws. Examples include investing in renewable energy, offering incentives to companies that adopt environmentally friendly practices, and building the necessary infrastructure to accommodate electric cars. Such actions inspire more businesses to use green logistics techniques and advance sustainability.

• For several reasons, including a structural shortage of contemporary logistics infrastructure, Japan currently has some of the strongest prospects in Asia. Just 16% of Japan's logistical facilities were built in the last ten years, and the majority (54%) are over thirty years old.

North America shows a significant growth in the green logistics market during the forecast period. An estimated 133 billion pounds of edible food are wasted annually in the United States alone. Food waste makes up 21% of the waste stream in American landfills, lume of material. Food waste costs Canadians $31 billion annually, or around 2% of the nation's GDP. They find local food and sustainable biodiesel, forgo single-use water bottles at live music events, and make meaningful and doable changes to green the industry.

The UN Alliance for Sustainable Fashion was established during the UN Environment Assembly's fourth session (UNEA-4) to end the fashion industry's harmful environmental and societal effects. It establishes sustainability goals, protects workers, especially women, by cutting waste, and capping carbon emissions.

Green Logistics Market Companies

• FedEx Corporation
• DSV
• Agility Public Warehousing Company K.S.C.P. and Subsidiaries
• CEVA Logistics
• XPO Logistics, Inc.
• United Parcel Service of America, Inc.
• GEODIS
• Deutsche Post DHL Group.
• YUSEN LOGISTICS CO., LTD.
• Bollor SE

Recent Developments

• In December 2023, A noteworthy achievement in Yusen Logistics' dedication to environmental sustainability was highlighted. Using fiscal year 2022 as a baseline, it has set a medium-term CO2 reduction target of 45% by 2030. Over the following five years, this target will motivate the firm to implement reduction initiatives, focusing on Scope 1 and 2 emissions.
• In October 2023, UPS declared its intent to purchase PayPal's Happy Returns. Happy Returns is a U.S. software and reverse logistics firm that helps customers and merchants have seamless, no-box, no-label returns.

Segments Covered in the Report

By Business Type

• Warehousing
• Distribution
• Value Added Services

By Mode of Operation

• Storage
• Roadways Distribution
• Seaways Distribution
• Others

By End-use

• Healthcare
• Manufacturing
• Automotive
• Banking and Financial Services
• Retail and E-Commerce
• Others

By Geography

• North America
• Asia Pacific
• Europe
• Latin America
• Middle East & Africa