Freight Transport Market Trends

Growth Drivers

• Growing adoption of artificial intelligence (AI) - The freight industry's supply chain management has been completely transformed by AI-powered predictive analytics, which can mine massive databases for insightful information that can be used to help freight forwarders spot patterns, streamline operations, promote sustainability and increasing the efficiency and competitiveness of logistics.
  
  For instance, professionals in the transportation and logistics industries have responded, and they indicate that more than 45% of businesses employ basic data analytics and around 24% use artificial intelligence.
• Rising spending on efficient logistics solutions - Successful supply chain management greatly depends on effective logistics management; therefore both large and small shops are spending on having effective logistics systems in today's fiercely competitive industry to stay in business. This may augment the need for freight transport to ensure the smooth operation of every stage in the supply chain.
  
  The logistics operations account for around 10% of the expenditures incurred by the average online merchant.
• Growing shipment of goods via air - When it comes to shipping express shipments around the world, air transport services are the most in demand due to the speed, which is comparable to same-day delivery.
  As per IATA, over USD 6 trillion worth of goods are transported by air each year, making up about 35% of all trade in terms of value.

Challenges

• Varying regulations across different regions - Logistics, and transportation are controlled by a set of rules that have a variety of effects on freight shipping costs, which may impede freight transport market demand.
  For instance, to guarantee the protection of all parties concerned, regulations are implemented which have an impact on freight forwarding charges.
  Similarly, another area where laws may affect freight forwarding rates is fuel efficiency standards, which may raise the cost of transportation.
  Besides this, freight shipping rates can be affected by trade restrictions, which may raise the cost of shipping those items.
   
• Environmental concerns - One of the main industries contributing to greenhouse gas emissions is freight transport, which also includes particulate matter (PM), nitrogen oxides (NOx), sulfur oxides (SOx), and volatile organic compounds (VOCs), in addition to CO2 emissions due to excessive energy usage. However, regulations have been put in place as a result to lessen its environmental impact, and complying with these regulations can be expensive, leading to higher freight charges.
  For instance, more than 45% of freight in the EU is transported by road, which significantly increases greenhouse gas emissions.