How contract logistics is developing: an overview by region
Contract logistics is a promising sector for generating stable revenues. It is particularly popular in Europe, where the market is the second largest in the world and will remain so until at least 2027. Analysts predict that the value of services provided in Europe will exceed €90 billion in the near future, but competition will increase. Companies from Asia could pose a threat to European operators.
In 2023, the global contract logistics sector grew 3.8% to almost €285 billion. Although the market will continue to grow, Transport Intelligence analysts note a slowdown from the momentum of 2021, when growth was 8.7%. Nevertheless, the sector should grow steadily in the medium term. However, the pace will vary from region to region.
In terms of 2023 outcomes, the markets are as follows:
- APAC was first placed, with growth of 7.8% last year (to €114bn). The region accounts for 40% of the world’s total.
- Europe is in second place with €82.5 billion (29% of the total);
- North America is in third place with a market value of €71bn (25% of the total).
China and India had the biggest impact on the development of the sector in APAC, where demand for contract logistics services is growing steadily. The Middle East and North Africa are showing good momentum, but revenue in these regions was only around EUR 6 billion, or 2% of total revenue.
Market forecasts
Analysts do not expect the market situation to change significantly until 2027. On average, contract logistics will grow by more than 4% per year, and its value will reach around EUR 335 billion by that time.
The Asia-Pacific region will have the highest growth rate at around 6.9% annually. This will give local operators around 44% of the global market. Weakening competitors from North America and Europe will also strengthen their positions. As a result, market volume forecasts are as follows:
- APAC – around €147 billion
- Europe – EUR 90 billion;
- North America – €80 billion
The role of e-commerce
The e-commerce sector is one of the main drivers of the contract logistics industry. In 2023, the e-commerce services market grew by almost 8% to €451 billion. By 2027, this is forecast to increase to €684 billion at a CAGR of 10.3%. In Europe, e-commerce demand for warehousing will continue to grow, although not as strongly as in 2021. However, the sector will play an essential role in the development of contract logistics in all regions.
