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The less-than-truckload (LTL) market is estimated to grow at a CAGR of 7% between 2022 and 2027. The size of the market is forecast to increase by USD 103.05 billion. The growth of the market depends on serval factors, including advances in e-commerce in the retail sector, increased outsourcing of logistics services, and a tightening truckload market.
This report extensively covers market segmentation by type (long-haul carriers, superregional carriers, and regional carriers), capacity (light LTL volume and heavy LTL volume), and geography (APAC, North America, Europe, Middle East and Africa, and South America). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.
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Technavio categorizes the global less-than-truckload (LTL) market as a part of the global trucking market within the global transportation market. The parent global trucking market covers companies engaged in goods and passenger land transportation, including vehicle rental and taxi companies. Our research report has extensively covered external factors influencing the parent market growth during the forecast period.
The increased outsourcing of logistics services is notably driving the market growth, although factors such as the implementation of the ELD mandate may impede the market growth. Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
Key Less-than-truckload (LTL) Market Driver
The increased outsourcing of logistics services is notably driving market growth. Building a logistics infrastructure is a capital-intensive process, and the investment is blocked for a long duration. Therefore, several companies outsource their logistics services to reduce operational costs, along with maintaining cash flow in the company. Third-party logistics providers offer added value to the supply chain management (SCM) needs of shippers by customizing services as per their requirements. Therefore, the shipper can partly outsource the logistics needs and carry out the remaining functions in-house.
Worldwide, manufacturing companies are expanding their production capacities and operations. This increases their logistics requirements. Difficulties in fleet management, shortage of skilled drivers, lack of IT infrastructure, such as TMS, and operational issues are some of the issues faced by shippers when they manage the logistics in-house. This may affect the company's SCM. Therefore, benefits, such as increased operational efficiency and cost savings, induce shippers to outsource logistics, either partially or completely, to third-party logistics providers. This makes the supply chain process efficient. Hence, factors like these are boosting the market growth during the forecast period.
Significant Less-than-truckload (LTL) Market Trend
The rise in last-mile logistics is an emerging trend in the market. The final step of a delivery process is referred to as last-mile logistics. The focus of last-mile logistics is to deliver items to the end customer as fast as possible. The last-mile delivery market is expected to grow steadily during the forecast period, primarily because of the growth of e-retailing, the adoption of premium delivery services, and the focus on segment-specific service offerings.
The demand for last-mile delivery services is driven by online purchases that are usually delivered to the customer's doorstep. Purchases delivered through last-mile delivery services are increasingly preferred to physical shopping by many people due to the convenience and time-saving benefits offered by such delivery services. Furthermore, the premiumization of last-mile delivery services will also support the growth of such delivery services. This is mainly because customers are ready to pay premium delivery charges for the same-day or instant delivery of ordered goods and merchandise. Therefore, the abovementioned factors will drive the market growth during the forecast period.
Major Less-than-truckload (LTL) Market Challenge
The implementation of the ELD mandate is a major challenge impeding market growth. The global LTL market is subjected to government regulations, which are increasing the operational costs for LTL carriers. This law makes it compulsory for interstate motor carriers to equip their trucks with electronic logging devices, also known as ELDs. This device records the total driving hours of the vehicle. The ELD mandate was introduced to standardize the hours of service (HOS).
This mandate is leading to a change in the attitude of truck drivers. According to truckers, digital monitoring of drivers is an invasion of their privacy. With paper logs, drivers could drive more hours than legally allowed and move more loads in the same timeframe. As a result, drivers have started protesting against this law. This mandate is thus reducing the capacity hours in the LTL market. Therefore, it is anticipated that the pricing of LTL shipments will increase, which is expected to pose a threat to the growth of the global LTL market during the forecast period.
Key Less-than-truckload (LTL) Market Customer Landscape
The report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Global Less-than-truckload (LTL) Market Customer Landscape
Vendors are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Averitt Express Inc. - The company operates under one segment. The company under this segment offers freight transportation and supply chain services. The key offerings of the company include less-than-truckload services.
The report also includes detailed analyses of the competitive landscape of the market and information about 15 market vendors, including:
Qualitative and quantitative analysis of vendors has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize vendors as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize vendors as dominant, leading, strong, tentative, and weak.
The market share growth by the long-haul carriers segment will be significant during the forecast period. Long-haul LTL carriers are usually referred to as national LTL carriers. These carriers transport shipments within 3 to 5 days. LTL carriers in this segment usually have a labor union and operate extensively through a hub-and-spoke network.
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The long-haul carriers segment was valued at USD 74.63 billion in 2017 and continued to grow until 2021. Long-haul LTL carriers operate through a traditional hub-and-spoke model, where the shipment is collected from one point, brought to a centralized distribution center, and then dispatched to the specified destination. These carriers offer value-added services, such as packing, unpacking, and door-to-door collection of freight to both transport freight providers and customers. Manufacturers and e-retailers outsource their freight and transportation needs, as maintaining in-house transportation require high investment and expertise, which significantly adds to the company's costs. Moreover, this market provides other services, too, such as project logistics, network planning, cargo insurance, value-chain optimization, and customs brokerage. With the increase in industrial activities across the globe, the market for long-haul LTL carriers is expected to witness robust growth during the forecast period.
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APAC is estimated to contribute 61% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.
APAC is expected to lead the global market during the forecast period. The major factors responsible for the regional market growth are the high population in the region, which has led to an increase in the overall demand for goods through both online and offline channels, the growing popularity of the e-commerce industry, and the increasing number of smartphone and internet users. Additionally, with local and international e-commerce brands competing for consumer attention and market shares in the region the market is very competitive. Therefore, the high growth potential offered by the LTL market in the region is likely to attract the interest of new players. Hence, all these factors will boost the regional market during the forecast period.
The outbreak of COVID-19 in 2020 negatively impacted the regional market. However, by the end of 2020, many governments started lifting the restrictions on logistics activities, considering them essential services. While the pandemic had led to a period of extreme upheaval for brick-and-mortar stores, it has driven a dramatic uptake of digital adoption across APAC, further accelerating the shift toward online retail channels that were already in the phase of growth. The adoption of e-commerce has surged since the start of the pandemic in 2020. As consumers increasingly embrace the benefits of safety and convenience offered by e-commerce, the shift to online shopping is expected to stay even after the pandemic. Therefore, the sudden rise in e-commerce shopping due to the COVID-19 pandemic is further expected to proliferate the demand for LTL services in the region during the forecast period.
The report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027. The market has been segmented by Type (Long-haul carriers, Superregional carriers, and Regional carriers), Capacity (Light LTL Volume and Heavy LTL Volume), and Geography (APAC, North America, Europe, Middle East and Africa, and South America).
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Less-than-truckload (LTL) Market Scope |
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Report Coverage |
Details |
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Page number |
163 |
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Base year |
2022 |
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Historic period |
2017-2021 |
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Forecast period |
2023-2027 |
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Growth momentum & CAGR |
Accelerate at a CAGR of 7% |
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Market growth 2023-2027 |
USD 103.05 billion |
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Market structure |
Fragmented |
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YoY growth 2022-2023(%) |
7.98 |
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Regional analysis |
APAC, North America, Europe, Middle East and Africa, and South America |
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Performing market contribution |
APAC at 61% |
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Key countries |
US, China, Japan, Germany, and France |
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Competitive landscape |
Leading Vendors, Market Positioning of Vendors, Competitive Strategies, and Industry Risks |
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Key companies profiled |
Allcargo Logistics Ltd., ArcBest Corp, Averitt Express Inc., Challenger Motor Freight Inc., Debon Logistics Co. Ltd., Deutsche Post AG, Estes Express Lines, FedEx Corp., J.B. Hunt Transport Services Inc., JRC Dedicated Services Co., Knight Swift Transportation Holdings Inc., Kuehne Nagel Management AG, Nippon Express Holdings Inc., Old Dominion Freight Line Inc., R L Carriers Inc., Schneider National Inc., Southeastern Freight Lines, United Parcel Service Inc., XPO Logistics Inc., and Yellow Corp. |
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Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and Market condition analysis for the forecast period. |
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Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Type
7 Market Segmentation by Capacity
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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