Philippines Freight and Logistics Market to Grow at a CAGR of 8.1% During 2024-2032, Aided by the Improvements in Logistics Infrastructure

The increasing integration of state-of-the-art technology in logistics operations is positively influencing the Philippines freight and logistics market. Advanced technologies such as artificial intelligence, blockchain, virtual reality, Internet of Things (IoT), robotics and automation, and big data are now being utilised in the logistics sector. These technological advancements are essential in ensuring the authenticity of documents and products, thereby improving transparency and security in global trade. Moreover, they streamline various operations, including contract management and payment settlement, resulting in efficient and accurate delivery of goods.

In December 2022, the Filipino Department of Trade and Industry (DTI) entered into three agreements with the Department of Transportation (DOTr) and the Department of Public Works and Highways (DPWH) to improve the logistics infrastructure in the nation. Moreover, in June 2021, the Department of Trade and Industry (DTI) and the Technical Education and Skills Development Authority (TESDA) entered into a Memorandum of Agreement (MOA) with 16 market Associations from the logistics services sector. This collaboration is aimed at enhancing the competitiveness and readiness of the logistics workforce through training and skills development initiatives.

The recent upsurge in environmentally conscious practices within the logistics sector is a significant trend aiding the Philippines freight and logistics market growth. Large corporations are embracing sustainable energy solutions to power their operations, including warehouses, electric vehicles, and distribution centres. This strategic shift aims to reduce greenhouse gas emissions and lessen reliance on fossil fuels.

In March 2024, UPS (NYSE: UPS) announced its decision to construct a new logistics hub at the Clark International Airport in the Philippines. This is a part of the company’s continued investments in the Asia Pacific region in an attempt to strengthen its supply chain, integrated express, and healthcare logistics services. Through the construction, the company aims to provide resilient services to customers, maximise its flexibility and speed, and build solutions focused on the shifting trade dynamics.

Department of Transportation 2024 Budget Allocation (in %), Philippines

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Market Analysis by Function and End Use:

• The market, on the basis of function, can be divided into courier, express and parcel, freight forwarding, freight transport, and warehousing and storage, among others.

• Based on end use, the market can be divided into manufacturing, consumer goods and retail, food and beverages, IT hardware and telecom, healthcare, chemicals, construction, automotive, and oil and gas, among others.

Key Findings of the Report:

• The Philippines ranked 43rd in the 2023 Logistics Performance Index (LPI) by the World Bank. This is driving improvements in port efficiency and logistics digitalisation efforts, aiding the Philippines freight and logistics market expansion.

• The Philippines' e-commerce market reached $17 billion in 2021, with 73 million active online users, and is projected to grow to $24 billion by 2025, driving the demand for logistics and freight services.

• Improvements in transportation infrastructure, buoyed by the introduction of favourable government initiatives, are enhancing the efficiency of logistics and freight services. In July 2023, the Filipino government boasted 197 projects in its Infrastructure Flagship Projects list, out of which 71 projects were in different stages of construction.

• There is a growing adoption of technologies such as artificial intelligence (AI) and the Internet of things (IoT) among key players to enhance their operational efficiency, offer customers safer, quicker, and more transparent services, and gain a competitive edge.

Key Offerings of the Report:

• The EMR report gives an overview of the Philippines freight and logistics market for the periods (2018-2023) and (2024-2032).

• The report also offers the historical (2018-2023) and forecast (2024-2032) markets for the functions and end uses of freight and logistics in the Philippines.

• The report analyses the market dynamics, covering the key demand and price indicators in the market, along with an assessment of the SWOT and Porter’s Five Forces models.

The major players in the the Philippines freight and logistics market are 2GO Group Inc., LBC EXPRESS, INC., Airfreight 2100 Inc., XDE Logistics, Transational Diversified Group, Royal Cargo, Inc., YUSEN LOGISTICS CO., LTD., Kintetsu World Express, Inc, and Laurel Carriers Philippines Inc., among others. The comprehensive report by EMR looks into the market share, capacity, and latest developments like mergers and acquisitions, plant turnarounds, and capacity expansions of the major players.

Key Highlights of the Report

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