GERMANY ROAD FREIGHT TRANSPORT MARKET - GROWTH, TRENDS AND FORECASTS (2023-2028)

The Germany Road Freight Transport Market is estimated to grow with a compounded annual growth rate of about xx% during the forecasted period of 2023-2028.  

With the restrictions on oil and gas imports from Russia, the industrial sector, especially the automotive manufacturers are experiencing severe impacts of deaccelerated production and expensive transportation costs leading to economic slowdown in the country. 

Although the country is strong enough to push itself through the slowdown, the impact is expected to stay for during the forecast period. The Germans, however, are focusing on creation of ties with other OPECs to aid their oil and gas needs. In November 2022, Qatar (companies including QatarEnergy and U.S. company ConocoPhillips) signed an agreement with Germany to provide LNG to the country for 15 years starting from 2026. The country is also taking steps to reducing its dependency on the finite sources of energy by implementing an overall modal shift to the rails especially for long distance goods transportation and is expected to reach to a minimum of 25% shift by the end of 2025. 

As reported by OECD in 2021, freight was transported to a total length of 307.28-billion-ton km, showing an increase of about 0.88% as compared to 2020. Although the numbers denote an increase, the majority of this was backed by the growth in operations in the country post the upliftment of COVID-19 restrictions, still below its pre-COVID levels which was at 311.87-billion-ton km.  

The manufacturing sector is the largest contributor to the country’s GDP and the road freight sector, especially the automotive manufacturing sector contributing to about 20% of the GDP in 2021. Although, the automotive sector is facing severe impact of rising energy prices, scarcity of semiconductors, rising logistics costs and elevated cost of living; leading to a weaker production number and eventually acting as a setback for the German trucking industry. 

Further, Germany is also facing severe labor shortage backed by the Ruso-Ukraine war and is expected to widen during the forecast period; adding to the increased logistics costs. 

However, the e-commerce sector is larger than ever and the increasing consumer expectations for shorter delivery time and cheaper costs of delivery are further developing the industry. The players in the market are focusing on developing services like Out-of-home (OOH) or PUDO and parcel locker delivery. The companies are focusing on creating hubs in major regions of the country to aid faster deliveries and reduce their carbon footprint. In September 2022, German startup Liefergrün landed EUR 12 million to scale sustainable last mile shipping solution in Germany. The company has entered a new partnership with Mercedes Van Rental to expand its emission-free delivery fleet in Berlin and has successfully landed major clients including Adidas, Dyson and ShopApotheke. 

The highly fragmented and competitive market for road freight transportation in Germany is heavily influenced by industrial production quantities and general economic growth. Deutsche Post DHL Group, DB Schenker, Dachser and DSV along with a mix of international and domestic players are some of the leading players in the market.