Road Freight Services Australia Category Intelligence
Trucking Regulations and Permissible Weight Limits
Truck Operating Cost Structure Analysis
Road Freight Services Australia Trends
Category Intelligence on Road Freight Services Australia covers the following
Information relating to market, supply, cost, and pricing analysis
Hard to find data on cost and TCO models, supplier details, and performance benchmarks
Macroeconomic and regional trends impacting cost, supply, and other market dynamics
Category-specific negotiation and sourcing advice
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Industry Outlook & Drivers
Regional Market Outlook on Road Freight Services Australia
The trucking industry in Australia is facing unprecedented changes, as digitization and shipper expectations are evolving. New technologies are enabling greater efficiency and more collaborative operating models, which can reduce truck operating costs
The long-term outlook of the road freight industry remains positive, with industry revenue predicted to continue to grow at a rate of 2.9 percent over the next five years to reach A$ 60.2 billion in 2025. Retail and manufacturing industries are expected to drive the growth rates
The Australian road freight market is estimated to be around $45 billion by 2020. The market is expected to grow at a CAGR 2.9 percent over the next five years
The road transport network in Australia accounted for approx. 195,000 million ton-km and moved a total of more than 2,000 million tons of freight every year
The primary cities with major freight flows are Sydney, Melbourne, Brisbane, Perth, Adelaide, Gold Coast, Newcastle and Canberra, while the Australian manufacturing, retail and wholesale sectors are also primarily focused on these regions, with a collective market share of more than 50 percent
Trucking Suppliers Landscape
The trucking market in Australia is highly fragmented with the top three service providers having less than 15 percent of market share
The total truck fleet in Australia is 3.6 Million with the small companies owning only 2–4 trucks on average
Toll holdings, Linfox and K&S/Scotts are considered to be the leading road freight service providers for LTL shipments in Australia based on their market share, services and geographical presence
Larger operators are investing heavily in safety and technology to achieve better quality in services and competitive advantage
Smaller operators with less scale and financial strength tend to be slow adopters to recent technologies and will become progressively challenged as shippers develop a stronger focus cost optimization and quality to protect their brand
Porter's Five Forces Analysis – Australia Trucking
In supply chain transportation market, key suppliers are sub-contracted truck operators and other supplier services like maintenance and repair, fuel, overhead labor, drivers and other consumable elements
Power of suppliers is high due to low availability of trucks and drivers and raising wage rate for employee in transportation market.
Barriers to New Entrants
Cost in terms of initial capital investment is high for 3PL market.
The critical factor is a lack of experience, which is very important for attracting clients. Additionally, service capability of new firms would not be at par with existing firms. However, this can be offset to a great extent by acquisition small, existing firms.
Intensity of Rivalry
Competition among global 3PL players is highly intense in Australia, with top players investing in locations like Adelaide, Melbourne, Sydney and Brisbane.
Threat of Substitutes
There is minimal threat of substitutes, because the only possible threat comes from the buyer developing an internal team
The acquisition trend, that is the acquisition of small and niche players by large 3PL firms, also reduces the threat of substitutes among large 3PL companies
Buyer's power to negotiate the freight rate and contractual terms is low due to strong consolidation of 3PL market in Australia
As a result of consolidation, scope of alternate service providers is very minimum and availability of service providers in the market is very less as well