Slow-down forecast for Contract Logistics Market

July 14, 2022

By Transport Intelligence

Contract Logistics Market exceeds pre-pandemic value but growth is set to slow, warn analysts from transport consultancy Ti, in latest research report  ̶  Global Contract Logistics 2022.

• Global contract logistics market is expected to grow at a slower pace of 7.1% y-o-y
• DHL and GXO maintain leading positions in North America and Europe
• China poised to overtake the US’ market value by 2026.

In 2021 the global contract logistics market rebounded and exceeded its pre-pandemic levels. The latest report from Ti – the leading provider of market research to the global logistics industry – shows that all regions have witnessed contract logistics market growth in 2021, a marked change from 2020. All regions have seen contract logistics markets surpass pre-pandemic levels.

The Global Contract Logistics Report  ̶   written by industry researchers, analysts and associates ̶  is one of several reports published each year by the Ti team, utilising data from its GSCI knowledge portal, a data powerhouse with over 1m pieces of data and analysis.

The report takes an in-depth look at the implications of a transforming retail market for logistics providers, as well as the current warehousing landscape. It outlines the forces which are shaping the future of warehousing, and questions whether multi-storey warehousing could be the answer to historically low vacancy rates.

Report Highlights:

• The global contract logistics market grew by 8.7% year-on-year in 2021. The global market is expected to grow by a further 7.1% y-o-y in 2022 and at a Compound Annual Growth Rate (CAGR) of 4.9% over the five years to 2026.
• Asia Pacific remains the largest contract logistics market by region, with China poised to overtake the US’ market value by 2026.
• The implications for the logistics sector supplying retailers with logistics services will be transformative. The reality of retail logistics will no longer be that of ‘trucks & sheds’, but rather a very reengineered environment that empathises speed, precision, and responsiveness.
• DHL and GXO have led the global contract logistics market. Both have managed to maintain leading positions in North America and Europewhich has helped both to top the list.
• Demand for warehousing is increasing, with low vacancy rates across the globe. The development of the global warehousing industry is also being influenced by three major categories of change drivers: supply chain trends, innovation, and customer needs.

The full report – available here – also provides a snapshot of the contract logistics providers which are leading the market on both a global and regional level. The report analyses the performance of providers against one another based on geographical revenues, profit margins, vertical sectors, and technology.

e-commerce a major growth driver

After contracting by 3.3% in 2020, the global contract logistics market grew by 8.7% year-on-year in 2021, surpassing its pre-pandemic market value. Market expansion was driven largely by pent-up demand and savings growth in the face of restrictions on activity, as well as global trade and recovering manufacturing. 

The e-commerce vertical was also a big growth driver during 2021, as the COVID-19 pandemic accelerated digital transformation and global internet penetration.

As the growth drivers gradually abate and the economy weakens, global trade growth is expected to moderate in 2022. As a result, the global contract logistics market is expected to grow at a slower pace of 7.1% y-o-y.  

 

To download the full report, which examines the retail market for logistics providers and includes performance analysis of the providers leading the market visit: https://www.ti-insight.com/product/global-contract-logistics

 

About Ti

Ti is the leading provider of market research solutions to the global logistics industry. With global research centres in the UK, USA and Indonesia, Ti operates a team of industry experienced researchers, analysts and associates who advise the World Economic Forum, World Bank, UN, and European Commission.

Global Supply Chain Intelligence (GSCi) is an online knowledge platform which provides users with unique data and analysis dedicated to the logistics industry, a powerhouse of data, changing global businesses.