New research from Ti reveals that the market grew 4.9% in real terms in 2018, one of the fastest growth rates seen in recent years.
New research from Transport Intelligence (Ti) reveals that the global contract logistics market grew 4.9% in real terms in 2018, one of the fastest growth rates seen in recent years.
Ti noted that the 2018 growth figure “paints a picture of a healthy market, with 2018’s expansion well above annual growth rates seen over much of the last decade”.
It said growth was expected “to remain at such levels over the forecast horizon too, suggesting ongoing strength in core manufacturing and retail markets at a global level”. Ti forecasts a slight slowdown in 2019, while looking ahead to 2023, Ti’s 5-year CAGR forecast for the global contract logistics market suggests an expansion rate of 4.7%.
But the latest round of contract logistics market sizing “reveals a mixed picture in major economies, however”, Ti noted. “In China, one of 95 markets for which contract logistics market sizing is available, the contract logistics market shows remarkable vigour, with a 2018 growth rate of more than double the global rate, powered by an expanding consumer market and the growth of advanced manufacturing fields such as robotics, IoT and 3D printing.”
In the US, the story in 2018 was “reasonably positive”; but while the US contract logistics market grew, “the rate of expansion was more modest and well below the global rate. The 5-year CAGR to 2023 for the US is muted at 2.0%,” Ti noted.
Nick Bailey, Ti’s head of research, commented: “2018 was a strong year for contract logistics providers in many respects. While the fundamentals remain positive, players in the market need to take advantage and react to some significant changes in the market.
“Across key verticals like retail, pharmaceuticals, automotive and beyond, demands are changing and shippers are expecting higher levels of service, digital offers and greater end-to-end value. The pressure is on contract logistics providers to make sure their offer stays relevant.”
Analysis in the 2019 edition of Ti’s Global Contract Logistics report also places DHL Supply Chain well ahead of its nearest competitors XPO and Kuehne + Nagel as the largest contract logistics provider globally, with a 6.2% market share.
Andy Ralls, quantitative analyst at Ti, said: “The global market for contract logistics grew at a strong pace in 2018, down only slightly on what was an excellent year in 2017. There are some stark contrasts between the significant bright spots in China, India and southeast Asia, when compared with developed markets in Europe, but even these are showing a reasonable level of expansion. This means that 3PLs across the world have had significant opportunities to grow their businesses.”
Source: Lloyd´s
