Logistics Automation Market Size, Share & Industry Analysis, By Component (Hardware, Software, and Services), By Logistics Type (Sales Logistics, Production Logistics, Recovery Logistics, and Procurement Logistics), By Application (Transport Management, Warehouse Management, Labor Management, and Others) By Enterprise Type (SMEs and Large Enterprises) By Industry (Retail & e-Commerce, Healthcare & Pharma, Food & Beverages, Aerospace & Defense, Energy & Utility, Automotive, and Others), and Regional Forecast, 2024 – 2032

The global logistics automation market size was valued at USD 69.62 billion in 2023. The market is projected to grow from USD 78.20 billion in 2024 to USD 212.81 billion by 2032, exhibiting a CAGR of 13.3% during the forecast period.

Logistics automation refers to the use of technology to optimize and streamline various aspects of the supply chain, improving accuracy and increasing efficiency in logistics operations. The components considered in the scope include various hardware and software for different purposes, such as autonomous drones for delivery, automated guided vehicles (AGVs) for material handling, robotic arms, predictive analytics software for automated storage and retrieval systems (AS/RS). It also encompasses conveyor belts, demand forecasting and inventory management, and other types of equipment that can handle tasks such as sorting, picking, packing, and shipping.

The COVID-19 pandemic severely impacted the supply chain globally. During the pandemic, lockdowns across the globe slowed down the flow of raw materials and finished products, which disrupted the manufacturing and logistics operations. In the first quarter of 2020, the supply chain was disrupted and the market showcased a slight decline. Despite the uncertain economic environment, 92.0% of businesses did not stop investing in technology during the pandemic. This highlighted the importance of digital supply chains, which helped companies overcome disruptive forces and respond quickly to volatile supply and demand conditions. However, after the partial opening of the supply chain and logistics industry in the last quarter of 2020, the market witnessed healthy growth rate, which is expected to remain the same in the upcoming years.

IMPACT OF GENERATIVE AI

Generative AI Is Transforming The Logistics Industry by Optimizing Processes And Improving Efficiency

Generative Artificial Intelligence (AI) is emerging as a transformative force across industries, including logistics. Generative AI has the ability to generate data, innovate, and reshape traditional logistics processes. Its capabilities make it a valuable tool for logistics companies looking to enhance their operations and improve overall customer satisfaction. It can automate mundane, tedious task and allow businesses to run on a predictive, proactive, and forward-looking model.

Here are several ways in which generative AI can contribute to logistics transformation:

• Route Optimization: GenAI helps in setting up efficient transportation plans and optimizing delivery routes by analyzing current traffic conditions, historical data, and other relevant factors. It can generate dynamic routing that can adjust instantly to delays and disruptions, reducing delivery time and improving overall efficiency.


• Customized Logistics Solutions: AI plays a vital role in customization by tailoring services and experiences to individual business needs. It also helps to analyze diverse data sources for understanding customer behavior and preferences. As per an industry expert, around 90% of consumers expect two- to three-day delivery fulfilment as the baseline, with 30% of shoppers expecting same-day delivery. From delivery schedules and personalized routing to dynamic pricing and understanding return patterns and customer feedback, AI can help businesses to build loyalty, enhance customer satisfaction, and differentiate themselves in a competitive market.

Logistics Automation Market Trends

Rapid Growth of E-commerce Market to Create Lucrative Opportunities for Market Players

The rapid growth of the e-commerce market is set to create significant opportunities for the market players. According to industry expert, the size of global e-commerce logistics market is expected to grow up to USD 858.89 Billion (770.79 Bn Euros). This growth is majorly influenced by the rise in online sales, which significantly increases the demand for efficiently shipment management. Furthermore, integration of digital technologies into logistics ecosystem allows end users to efficiently manage their shipments. The rise of e-commerce market directly helps in catering all these logistics related concerns. As the industry progresses, target audiences demand for transparent customer service.

Moreover, with the help of technologies such as data analytics, AI, and IoT provide end users with a complete overview of factors such as inventory management, supply chain performance, and customer insights. This strategy enhances the overall logistics ecosystem. Thus, the e-commerce growth is expected to create lucrative opportunities for market players in the coming years.

Logistics Automation Market Growth Factors

Digital Transformation Across Logistics Companies is driving Market Growth

Digital transformation has been a key lever for logistics companies in recent years, enabling them to modernize outdated systems, deliver automated operational processes, and provide better customer experiences. The rate of increasing investments is seen across both warehousing and transportation technologies. As the digital world expands, it has become essential for market players to invest in automation technologies such as cloud, IoT, and data analytics. Companies that fail to keep up with digital technologies would face the risk of falling behind their competitors. As per the survey by Accenture, 75% of logistics company leaders believe that neglecting digital capabilities would endanger their business.

Digital transformation helps businesses to embrace agile and responsive operations through data-driven insights. This approach allows companies to swiftly adapt to changing market demands and unforeseen disruptions. Logistics companies can forecast the demand fluctuations, allocate resource and enable proactive adjustments through predictive modelling and real-time data analytics. Furthermore, technologies including machine learning and AI enable dynamic route optimization, allowing agile adjustments in response to traffic, weather conditions, or other unforeseen events.

Therefore, digital transformation among enterprises is driving the logistics automation market growth.

RESTRAINING FACTORS

Lack of Appropriate Infrastructure, High Initial Investments & Costs, Regulatory Concerns, and Geopolitical Issues to Hinder Market Growth

The restraining factors of the market include lack of appropriate infrastructure, high initial investments and costs, regulatory concerns, and geopolitical issues. In countries such as South America and Africa, existing infrastructure is not favorable and lack of investments in infrastructure upgrades further hinders the logistics market growth. Implementing automated logistics systems requires significant investment in technology and training and many small and mid-sized companies globally fail to invest due to budget constraints, impacting market growth. In addition, regulatory & compliance issues and geopolitical concerns such as the Russia-Ukraine war, trade disputes, sanctions, tariff measures have created an environment of constant uncertainty for players in the market. The historic exit of the U.K. from the European Union due to Brexit has impacted global logistics as redefinition of trade and customs relations between Europe and U.K. has generated a series of logistical obstacle. Thus, insufficient infrastructure in South America and Africa, along with high initial costs, restricts logistics automation for smaller companies, hindering market growth.

Logistics Automation Market Segmentation Analysis

By Component Analysis

Hardware Segment Dominated with Adoption of AGVs and Robots to Automate Logistics Process

By component, the market is segmented into hardware, software, and services.

Based on component, the hardware segment dominated the market in 2023 and is expected to register the highest CAGR during the forecast period. The demand for hardware including autonomous mobile robots, AGVs, and other devices, is increasing, as these technologies can automate significant chunk of the logistics process. Robots can be used for packing and picking orders, loading and unloading trucks, while AGVs can be used to transport goods around distribution centers or warehouses.

The software segment is estimated to grow significantly during the forecast period. Software plays a crucial role in streamlining and optimizing various aspects of the logistics process. Software integrates with existing systems to automate processes and ensures seamless data flow. According to technology surveys, around 41% of companies have started investing in logistics automation software to ease the process of documentation. Therefore, the above-mentioned factors are boosting the logistics automation market share.

By Logistics Type Analysis

Demand for Production Logistics for Improving Profitability to Propel Segment Expansion

By logistics type, the market is segmented into sales logistics, production logistics, recovery logistics, and procurement logistics.

The production logistics is expected to grow with the highest CAGR during the forecast period. To improve profitability, businesses are focusing on optimizing the production process. Production logistics control and manage movements of inventories within manufacturing sites for ensuring the optimal flow of materials throughout the value chain. Production logistics helps SMEs to maintain business standards and reduce the likelihood of defects and errors in the production process.

Sales logistics dominated the market in 2023. Sales logistics plays a vital role in e-commerce and is a key differentiator for companies. Sales logistics involves managing logistics, capital flow, and information flow to transfer the ownership of products to customers. Sales logistics is most important part of the supply chain as it includes delivering or moving products to the end consumer. Sales logistics comprise inventory management, vendor management, order management, and shipping management.

By Enterprise Type Analysis

SMEs Segment to Grow With Highest CAGR owing to Growing Demand for Logistics Automation Solution to Enhance Efficiency

By enterprise type, the market is divided into large enterprises and SMEs.

The SMEs segment is expected to grow at the highest CAGR during the forecast period. SMEs are increasingly adopting logistics automation solutions for reducing logistics cost and enhancing efficiency. Automation solutions can help SMEs to significantly scale operations and productivity.

Large enterprises dominated the market in 2023 as automation solution allow large enterprises to augment their operations and reduce inefficiencies and errors that usually come with manual labor. As per experts, around 75% of large enterprises will implement intelligent robots for automating their logistics process.

By Application Analysis

Transport Management Segment Led owing to Improve Delivery Times

By application, the market is divided into transportation management, warehouse management, labor management, and others.

Transport management dominated the market in 2023. Cost concerns are a major issue in logistics transportation. Therefore, logistics automation is integrated with ERP system to access the address book, automatic storage, and handle fuel surcharges and accessories. This integration eliminates the need to manually enter the data and it leads to cost reduction and enhanced products transportation. The adoption of automation solution is increasing in transport management to reduce transportation cost, increase visibility of supply chain, and improve delivery times.

Warehouse management is expected to grow with the highest CAGR during the forecast period. Automation solution helps to automate task including picking and shipping. These systems speed up the movement of goods, reduce the risk of errors, and reduce the amount of manual handling of heavy items and repetitive activities. Additionally, automation helps to minimize the risk of workplace injuries and increases workforce satisfaction.

By Industry Analysis

Surge in Usage of Logistics Automation Solution for Precise Deliveries Led the Retail & E-commerce Segment

By industry, the market is divided into retail & e-commerce, healthcare & pharma, food & beverages, aerospace & defense, energy & utility, automotive, and others.

Retail & e-commerce dominated the market in 2023. Automation of logistics process is significant for e-commerce and retail as it enhances efficiency and speeds up supply chain. Automation allows faster and more precise deliveries and optimizes operations through advance data capture and analysis. In 2023, around 75% of internet user ordered goods online in Europe and it is estimated that online sales will reach around USD 1.5 Trillion (1.4 Tr Euros) by 2027.

Healthcare and pharma is estimated to register the highest CAGR during the forecast period. Automation solutions in logistics streamline and organize business process and provide intelligent insights that positively impact decision-making, driving growth and understanding pain points. Automation helps to guarantee the exact and timely delivery of products in best condition. As a result, healthcare providers can enhance patient care and boost efficiency within hospitals.

REGIONAL INSIGHTS

The market is studied across the regions, including North America, South America, Europe, the Middle East & Africa, and the Asia Pacific. These regions are further classified into leading countries.

North America dominated the market in 2023, maintaining its leading position in the logistics sector. The logistics industry is poised for substantial growth, due to significant economic activities and supporting the flow of goods across borders. This growth is influenced by shifts in global trade dynamics and adoption of advanced technologies for automating logistics process. The rising demand for advanced AI and the rapid adoption of generative AI across the North American countries for transforming the logistics industry is driving market growth in the region. Generative AI is used by companies to forecast disruptions in the supply chain, such as, route deviation, potential breaches of Service Level Agreements and unexpected weather anomalies. As per recent survey by Locus, around 69% of businesses reported lacking visibility over their supply chain. Thereby to overcome this challenge, the adoption of generative AI applications such as control towers, real-time fleet tracking is increasing, enabling businesses to identify potential delays and take necessary action before they impact the revenue.

The Asia Pacific region is expected to be home to the fastest growing market for logistics automation owing to its rapidly expanding e-commerce industry. The rapid expansion of e-commerce sector demands advanced logistics solutions to meet customer expectations, with autonomous last-mile delivery at the forefront of this transformation. As the logistics revolution continues more consumers look for flexible delivery options. As per HERE Technologies APAC on the Move Report, around 82% of e-commerce companies in the region are expressing their need for end-to-end tracking of all shipments. Additionally, around 33% of logistics companies are planning to buy drones for enhancing their services and 45% of logistics companies will invest in logistics asset tracking solutions to improve customer experience.

The market in Europe is driven by substantial rise of digital transformation among industries, industry 4.0 and IoT. As per YouGov, around 33% of logistics companies in the region have started implementing digital transformation strategies and companies have a clear vision of technologies and digital megatrends that will significantly impact logistics sector. As per the survey, around 71% respondent think cloud service, 63% respondent think IoT and 58% respondent think Big Data plays a significant role in logistics. The Digital Transport and Logistics Forum is bringing together private and public stakeholders from various logistics and transport communities for supporting the European commission in promoting digital transformation in the logistics sector.

South America and the Middle East & Africa are experiencing growth due to factors including digital transformation among logistics and supply chain and technological advancements.

KEY INDUSTRY PLAYERS

Major Players Focus on Developing Advanced Products to Strengthen Their Market Positions

Key players operating in the market constantly seek relevant acquisitions of prominent technology providers with the sole aim of delivering their clients with advanced and enhanced tools. Along with acquisitions, these high-performing companies regularly enter into strategic collaborations and partnerships to improve their product knowledge and marketing capabilities. These strategies enhance overall product functionality, expand the product portfolio, and, most importantly, enhance client experience.

List of Top Logistics Automation Companies:

• Daifuku Co., Ltd. (Japan)


• Honeywell International Inc. (U.S.)


• TGW Logistics Group (Austria)


• Toyota Industries Corporation (Japan)


• KUKA AG (Germany)


• SSI SCHAEFER Group (Germany)


• Jungheinrich AG (Germany)


• KION Group AG (Germany)


• Murata Machinery, Ltd (Japan)


• Knapp (Austria)

KEY INDUSTRY DEVELOPMENTS:

• February 2024: Dematic entered into a partnership with Groupe Robert, a Canadian Logistics company. The aim of partnership was to open automated cold storage facility. The facility has high capacity Automated Storage and Retrieval System with 130 foot tall cranes for managing frozen and fresh foods.


• January 2024: Honeywell entered into a partnership with Hai Robotics for delivering high density and flexible storage and retrieval solutions to distribution centers. The partnership aimed to integrate Honeywell’s Momentum Warehouse Execution software with Hai’s innovative robotics technology.


• May 2024: The Toyota Industries Corporation introduced a new Toyota Automated Logistics Group with the aim of housing its present subsidiary, Toyota L&F, alongside Bastian Solutions, Vanderlande, and viastore. With this, the company expects to expand its reach in all integrated and automated projects across the globe.


• March 2024: The Hyundai Movex signed a USD 14.96 million contract with EcoPro BM Co. with the objective of providing a logistics automation system in January. The company is expected to start in March and be completed by 2026.


• November 2023: Knapp, an automation solution provider, partnered with Biogena, an Austrian Health Product company for automating the processing of international shipping.  

REPORT COVERAGE

The report provides a detailed analysis of the market and focuses on key aspects, such as prominent companies, product types, and leading applications of the product. Besides this, it offers insights into the market trends and highlights the competitive landscape. In addition to the factors mentioned above, it encompasses several factors that have contributed to the growth of the market in recent years.

Report Scope & Segmentation

ATTRIBUTE	DETAILS
Study Period	2019-2032
Base Year	2023
Estimated Year	2024
Forecast Period	2024-2032
Historical Period	2019-2022
Growth Rate	CAGR of 13.3% from 2024 to 2032
Unit	Value (USD Billion)
Segmentation	By Component Hardware Software Services By Logistics Type Sales Logistics Production Logistics Recovery Logistics Procurement Logistics By Enterprise Type SMEs Large Enterprises By Application Transport Management Warehouse Management Labor Management Others By Industry Retail & E-commerce Healthcare & Pharma Food & Beverages Aerospace & Defense Energy & Utility Automotive Others By Region North America (By Component, Logistics Type, Application Enterprise Type, Industry, and Country) U.S. Canada South America (By Component, Logistics Type, Application Enterprise Type, Industry, and Country) Brazil Argentina Rest of South America Europe (By Component, Logistics Type, Application Enterprise Type, Industry, and Country) United Kingdom Germany France Italy Spain Russia Benelux Nordics Rest of Europe Middle East & Africa (By Component, Logistics Type, Application Enterprise Type, Industry, and Country) Turkey Saudi Arabia Egypt Nigeria UAE Rest of Middle East & Africa  Asia Pacific (By Component, Logistics Type, Application Enterprise Type, Industry, and Country) China India Japan South Korea Philippines Indonesia Malaysia Vietnam Australia Rest of Asia Pacific