Last Mile Delivery Market Analysis

Last Mile Delivery Market Analysis

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Based on vehicle type, the market is divided into drones, vans & trucks, robots, and two-wheelers. In 2023, the vans & trucks segment accounted for a market share of around 50%. With a focus on reducing carbon emissions and operating costs, logistics companies are investing in EVs, such as trucks and vans, for urban deliveries. This shift toward sustainable transportation solutions reflects growing environmental awareness and regulatory pressures to curb pollution in urban areas. For instance, in July 2023, Amazon significantly broadened its fleet of Rivian-manufactured electric delivery vans across the U.S. Surpassing 10,000 units, these vans operate in over 1,800 U.S. cities. Equipped with advanced safety and driver assistance features such as 360-degree visibility, automatic emergency braking, and highway/traffic assist, these electric vans offer a remarkable range of up to 150 miles.
 

Based on application, the market is categorized into e-commerce, food & grocery, parcel & courier services, pharmaceutical, and furniture & appliances. In 2023, the e-commerce segment accounted for a market share of around 42% and is projected to grow by 2032. The expanding e-commerce sector is reshaping last mile delivery dynamics. With the surge in online shopping, delivery services are adapting to handle higher volumes and meet evolving customer expectations for fast and convenient shipping. This shift toward digital retailing is driving innovations in delivery logistics, technology, and customer service to ensure seamless last mile delivery experiences.
 

For instance, in October 2023, iThink Logistics, a prominent logistics technology firm, joined forces with India Post, the country’s primary postal network, to enhance e-commerce deliveries throughout India, with a focus on rural and remote regions. This collaboration aims to leverage India Post's extensive nationwide coverage and merge it with iThink Logistics' cutting-edge technology and swift delivery services. By combining tradition with innovation, this partnership is poised to revolutionize last-mile logistics operations, enabling Direct-to-Consumer (D2C) startups and Small & Medium Businesses (SMBs) to extend their presence beyond urban centers.
 

North America dominated the global last mile delivery market with a major share of over 37% in 2023. The rapid market growth is fueled by the increasing dominance of e-commerce, particularly post-pandemic. As consumers continue to embrace online shopping, there is a heightened demand for efficient and flexible delivery options. This trend is driving investments in technology, infrastructure, and sustainable transportation solutions to meet evolving customer expectations and optimize the last mile delivery process. For instance, in December 2023, Bolloré Logistics and Sarcona announced a collaboration to introduce an electric truck for last-mile delivery connecting New Jersey and New York. Manufactured domestically, the electric truck has a 200-mile range and will be in operation for 359 days annually, traveling approximately 60 km each day.
 

Asia Pacific last mile delivery market is experiencing exponential growth driven, by the burgeoning e-commerce sector and urbanization. With a massive population and rising number of middle-class consumers, there is a surge in online shopping, leading to increased demand for efficient last mile delivery services. To address this demand, companies are leveraging advanced technology, such as AI-powered route optimization and drone delivery, while investing in infrastructure and logistics networks to ensure timely and cost-effective deliveries across diverse and densely populated regions.
 

In European countries, such as France, Germany, Italy, and the UK, the last mile delivery industry is evolving rapidly alongside the growth of e-commerce. With consumers increasingly turning to online shopping, there is a heightened emphasis on efficient and sustainable delivery solutions. Companies are investing in EVs, bike couriers, and innovative logistics technologies to meet environmental regulations and consumer expectations for eco-friendly options. Additionally, urbanization trends are propelling the need for optimized delivery networks to navigate congested city streets and deliver goods swiftly to customers' doorsteps.