Countries in Asia Pacific are at very differing stages of economic development, and this flows through to road infrastructure and regulation.
Markets such as Japan, Singapore, Hong Kong and South Korea, etc. are well advanced and have similar characteristics to their counterparts in western Europe. At the other end of the scale, the Asian region also includes a number of largely untapped economies – such as Myanmar, Cambodia, Laos – which have little in the way of sophisticated manufacturing or logistics services, relying heavily on trade with more developed neighbours. Bridging these two ends of the spectrum are the countries of Vietnam, Malaysia, Thailand, Indonesia and the Philippines, markets which have been growing for some time but have still not reached maturity and remain a long way from the level of sophistication as the economic powerhouses of the region.
Add to this mix of varied economic development the fact that many countries in the region comprise Islands, or numerous islands, or have limited land borders (some of which are closed – South Korea / North Korea – or suffer due to political unrest – Pakistan / India) and this makes for a very complex sector.
Driving across Asia is nothing like driving throughout Europe, or North America. Most Asian countries adopt their own set of regulations and vehicle / driving standards (if any at all) and hauliers may meet these minimum standards in one regime, only to fall foul in a neighbouring jurisdiction. Other challenges in the region include high levels of bureaucracy and possible corruption at border crossing points and a lack of region-wide multi-lateral or bi-lateral agreements, which is hindering intra-regional trade.
In most developing, or undeveloped, economies the commoditised road transport element is usually dominated by ‘local-hero’ companies, either due to regulation restricting access to foreign companies, low barriers to entry due to cheap access to vehicles, or local knowledge. These companies tend to be small. For example, in China, in 2015, the number of freight vehicles on the road was 13.9 million and the number of carriers was 7.2 million. This comprises an average of two trucks per carrier; 91.8% of which are owner-operators. This compares with 39% in the US. 86.5% of carriers in China own fewer than 10 trucks. Data on these ‘local-hero’ companies is sparce, with limited financial or operational information published.
This high-level of complexity makes estimating the value of the road transport sector in these markets extremely problematic. In order to overcome this, Ti’s Economist and Market Sizing team have developed a robust methodology in-line with the company’s Strategic Consulting division who have travelled to, and interviewed, many businesses in the Asian markets. This ‘dual-approach’ approach has allowed us to call upon the local knowledge gleaned from previous consulting projects and apply this ‘real-world’ data to our already tested and respected market size models. In doing so, Ti now has robust estimates of the road freight, warehousing and customs segments in all Asian markets, to add to its existing logistics, freight forwarding and express market size figures. We will be adding the key GCC and Latin American economies to this data-set in the coming weeks.
Source: Transport Intelligence, July 22, 2021
Author: Joel Ray
Emerging Markets Market Sizing Data:
Emerging Markets Market Sizing Data:
Ti now has robust estimates of the road freight, warehousing and customs segments in all Asian markets, to add to its existing logistics, freight forwarding and express market size figures. We will be adding the key GCC and Latin American economies to this data-set in the coming weeks.
For more information on how to access this proprietary data please visit – www.ti-insight.com/gsci-market-sizing
Or contact Michael Clover at [email protected].