Hyderabad, Jan. 19, 2023 (GLOBE NEWSWIRE) -- The Canada road freight transportation market witnessed a CAGR growth of around 4.57% in value during the review period (2016-2021), with the exception of 2020. In 2020 a decrease in the market value of 9% YoY in value was experienced due to trade restrictions imposed to curtail the spread of Covid-19. The trade value witnessed a decline in the market value of around 11.65% YoY in 2020 reaching USD 604.4 billion. However, since 2021, the economy has recovered to pre-covid levels of trade, reaching a value of around USD 736 billion.
In 2021, the wholesale and retail industry accounted for the largest end-user share in the Canadian road freight transport market and contributed around 10.59% to the country's GDP. In 2021, the wholesale and retail trade segment had the maximum share of around 32% in value in the Canada road freight transport market, closely followed by the manufacturing sector with 23.9% in value. During the study period (2016-2021), the wholesale and retail trade segment registered a CAGR of 2.55% in volumes and 6.38% in value (USD). The main factor contributing to this has been the increasing share of e-commerce sales globally, which has led to increasing e-commerce exports. As a result of this, international road freight transportation has a higher share in value than domestic road freight transportation in Canada road freight transport market. In addition, the e-commerce industry (CAGR of 16% from 2016-2021) has been driving the last mile domestic delivery segment since the implementation of social distancing norms and work-from-home scenarios in 2020. In 2021 alone, 24.1% YoY growth has been registered and is expected to boom in the future.
Moreover, less than truckload is the fastest-growing segment in the market as e-commerce retail sales have been soaring in Canada. During COVID-19 pandemic less-than-truckload service industry witnessed a decline in the market value of around 7.93% YoY in 2020 due to a decrease due to a decrease in demand for goods as well as their production in various industries such as the manufacturing industry with a decline of 9.69% YoY followed by oil and gas, mining and quarrying industry with a decline of 7.58% YoY in Canada. However, in 2021, the demand for less-than-truckload service increased as the domestic and global economies recovered. In addition, most of the vendors on e-commerce sites utilized the boom in growing e-commerce sales and utilized the less than truckload services to penetrate the Canadian markets, and they have been able to establish a presence in the country.
Overall, the scope and opportunities in the market are being driven by the initiatives undertaken by the country to curtail environmental pollution. For instance, the Government of Canada has invested over USD 1 billion to support increased zero-emission vehicle adoption. Furthermore, the Zero Emission Vehicle Infrastructure Program (ZEVIP) is a USD 680 million initiative ending in 2027 and its objective is to address the lack of charging and refuelling stations in Canada, one of the key barriers to ZEV adoption, by increasing the availability of localized charging and hydrogen refuelling opportunities. The current goal of the Zero Emission Vehicle Infrastructure Program is to support the deployment of 33,500 EV chargers and 10 hydrogen refuelling stations. Moreover, FDI investments in infrastructure construction projects and partnerships deals in the logistics sector are creating a favourable business environment for logistics players in the region. For instance, Canada Budget 2022 proposes USD 450 million over five years, starting in 2022-23, to support supply chain projects through the National Trade Corridors Fund, which will help ease the movement of goods across Canada’s transportation networks. With such opportunities, the Canada road freight transportation market is expected to have a YoY growth of around 6.5% in value in 2023.
