Freight Logistics Market Set for Steady Growth, Projected to Reach USD 167 Million by 2034

The Market is expanding with strong growth supported by e-commerce, infrastructure development, technology adoption, and sustainable practices

VANCOUVER, BRITISH COLUMBIA, CANADA, August 25, 2025 /EINPresswire.com/ -- The Freight Logistics Market in Australia is on track for steady growth, projected to increase from USD 108 million in 2024 to USD 167 million by 2034, reflecting a CAGR of 4.42%. The expansion is being fueled by the rapid rise of e-commerce, major infrastructure investments, and the adoption of advanced technologies such as artificial intelligence (AI) and the Internet of Things (IoT).

Regional Outlook

Victoria has emerged as the fastest-growing region, driven by robust infrastructure development and strategic logistics investments. Meanwhile, New South Wales maintains its position as the largest market, supported by its strong logistics network and proximity to major ports.

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Growth Drivers

The biggest catalyst for growth is e-commerce, with online retail sales expected to rise by 15% annually, according to the Australian Bureau of Statistics. This surge in digital shopping has created strong demand for last-mile delivery services, warehousing, and efficient inventory management.

Technology is playing a vital role in shaping the industry. Logistics companies are increasingly adopting AI-driven analytics to optimize route planning, reduce delivery times, and cut costs. Companies that have integrated AI into their operations have reported up to 30% savings in operational costs, while IoT devices are providing real-time visibility in supply chain management.

Infrastructure projects are also strengthening the logistics landscape. The Australian Government’s AUD 110 billion infrastructure pipeline is improving road, rail, and port networks, enhancing connectivity, and lowering transportation costs. Notably, Toll Group’s AI-powered logistics platform has introduced real-time tracking and predictive analytics, marking a significant step forward for the industry.

Key Challenges

Despite its growth prospects, the industry faces hurdles. High operational costs—driven by fuel, labor, and vehicle maintenance—consume nearly 30% of logistics companies’ revenues. Compliance with regulations such as the Heavy Vehicle National Law (HVNL) adds further complexity, costing the industry an estimated AUD 2 billion annually.

Smaller players face additional challenges due to rising cybersecurity demands under the Privacy Act and the lack of uniform regulatory standards across states. These factors limit investments in technology and infrastructure, slowing down growth for some operators.

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Market Segmentation

By Product Type

Road Freight remains the largest segment, generating USD 45 million in 2024 and projected to reach USD 70 million by 2034 (CAGR 4.5%). Its dominance is attributed to flexible, door-to-door delivery—crucial for retail and e-commerce.

Rail Freight is the fastest-growing segment, set to expand from USD 20 million in 2024 to USD 33 million by 2034 (CAGR 5.2%). Projects such as the Inland Rail between Melbourne and Brisbane are strengthening intercity and port connectivity.

Sea Freight and Air Freight continue to play vital roles, supporting bulk international trade and high-value, time-sensitive shipments, respectively. Both are expected to grow steadily with advancements in port and air cargo infrastructure.

By Application

Retail is the leading application segment, projected to grow from USD 40 million in 2024 to USD 65 million by 2034 (CAGR 4.8%). The rapid rise of online shopping has pushed retailers to collaborate with logistics providers for faster and more reliable delivery solutions.

Manufacturing is the fastest-growing application, expected to rise from USD 25 million in 2024 to USD 40 million by 2034 (CAGR 5.0%). Growth is supported by domestic production resurgence and government initiatives like the Modern Manufacturing Strategy.

Healthcare continues to demand logistics solutions for temperature-controlled transport and medical supplies distribution, while Automotive logistics benefits from the expansion of the electric vehicle market.

Sustainability Trends

The industry is increasingly adopting green logistics practices, with a reported 20% rise in sustainable operations. Companies are focusing on reducing carbon emissions through fleet upgrades, renewable energy adoption, and environmentally friendly packaging solutions.

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Freight Logistics Competitive Strategies & Notable Developments

Top 10 Companies

Toll Group

Linfox

Australia Post

DHL

FedEx

UPS

DB Schenker

Kuehne + Nagel

DPD Group

Aramex

Strategy

Top players in the Freight Logistics Market in Australia are competing through strategic partnerships, technological integration, and service diversification. Toll Group and Linfox are leveraging AI and IoT technologies to enhance operational efficiency and reduce costs. Australia Post is focusing on expanding its e-commerce logistics capabilities through strategic partnerships with online retailers. DHL, FedEx, and UPS are investing in sustainable logistics solutions and expanding their logistics networks to capture market share. DB Schenker and Kuehne + Nagel are focusing on digital logistics solutions and expanding their presence in emerging markets. DPD Group and Aramex are investing in last-mile delivery solutions and expanding their logistics networks to enhance service offerings.

Freight Logistics Market Segmentation

By Product Type

Road Freight

Rail Freight

Sea Freight

Air Freight

By Application

Retail

Manufacturing

Healthcare

Automotive

By End User

B2B

B2C

By Technology

AI and Machine Learning

IoT and Telematics

Blockchain

By Distribution Channel

Direct

Third-Party Logistics (3PL)

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