August 2024
Artificial Intelligence (AI) in Logistics Market (By Application:Self driving Vehicles and Forklifts, Machine and Human Collaboration, Planning and Forecasting, Automation of Ordering and Processing, Others; By Technology: Machine Learning, Context Awareness Computing, Natural Language Processing, Computer Vision; By Industrial Vertical: Automotive, Retail, Healthcare, Food and Beverages, Manufacturing, Others) - Global Industry Analysis, Size, Share, Growth, Trends, Regional Outlook, and Forecast 2024-2033
The global artificial intelligence (AI) in logistics market size was USD 12.24 billion in 2023, calculated at USD 17.96 billion in 2024 and is expected to reach around USD 565.82 billion by 2033, expanding at a CAGR of 46.72% from 2024 to 2033. The rising developments in the logistics sectors across the world are driving the growth of the artificial intelligence (AI) in logistics market.
The U.S. artificial intelligence (AI) in logistics market size was valued at USD 4.11 billion in 2023 and is expected to be worth around USD 193.58 billion by 2033, at a CAGR of 46.99% from 2024 to 2033.
North America held the largest market share in 2023 and is expected to maintain its dominance throughout the forecast period. The growth of this region is mainly driven by the rising government initiatives in countries such as the US, Canada, and Mexico to develop the AI infrastructure. For instance, in May 2023, the U.S. National Science Foundation announced that it would invest around US$140 million to inaugurate seven National AI Research Institutes. These institutes will promote AI research and development (R&D) infrastructure and support the growth of a diverse AI workforce.
The rising number of modern warehouses, along with the presence of several automotive and healthcare companies, has increased the demand for the integration of AI in the logistics industry. Moreover, the advancement in internet facilities, along with the rising demand for security systems in the logistics sector, has boosted the market growth in this region. The presence of an established retail industry with several supermarkets and local shops, along with a well-established logistics sector in this region, propels the market growth. Furthermore, the presence of several AI in logistics companies such as Alphabet, Microsoft, IBM, Amazon and some others boost the growth of the Artificial Intelligence (AI) in logistics market.
Asia Pacific region is expected to be the fastest-growing region during the forecast period. The growth of this region is mainly driven by the growing developments in science and technology in several countries such as India, China, South Korea, Japan, and others. Also, the growing interest from the public and private sectors in development & research for developing AI industries has boosted the market growth. The growing advancements in manufacturing industries, along with rising developments in the food and beverage sectors, are driving the artificial intelligence (AI) in logistics market growth. Furthermore, the presence of AI in logistics providers such as Yojee Limited, Pluto7 Corporation, Alibaba Cloud, DJI, Leapmind, and others drives the growth of AI in the logistics industry.
The artificial intelligence (AI) in logistics market is an important part of the logistics domain. This industry deals with the use of AI in managing and transporting various products across the globe. This market is expected to grow significantly with the rise in the number of government initiatives for developing the AI infrastructure across the world. This market integrates several technologies that mainly include machine learning (ML), context awareness computing, natural language processing (NLP), and computer vision.
There are several applications of AI in logistics that mainly include self-driving vehicles and forklifts, machine and human collaboration, planning and forecasting, automation of ordering and processing, and some others. This industry mainly deals with delivering products from several end-user industries such as automotive, retail, healthcare, food and beverages, manufacturing, and others to people across the world. AI in the logistics industry is expected to grow exponentially with the growth in AI and logistics industries.
Report Coverage | Details |
Market Size by 2033 | USD 565.82 Billion |
Market Size in 2023 | USD 12.24 Billion |
Market Size in 2024 | USD 17.96 Billion |
Market Growth Rate from 2024 to 2033 | CAGR of 46.72% |
Largest Market | North America |
Base Year | 2023 |
Forecast Period | 2024 to 2033 |
Segments Covered | Application, Technology, Industrial Vertical, and Regions |
Regions Covered | North America, Europe, Asia-Pacific, Latin America, and Middle East & Africa |
The growing integration of AI in logistic operations
The logistics industry has developed rapidly due to the advancements in sciences and modern technologies. The ongoing development in AI and ML technologies has also contributed significantly to the development of the logistics sector. The integration of AI in modern warehouses also helps in database management, packaging, manufacturing, enhanced warehouse safety, and some other operations that help maintain logistics operations. Thus, rising developments in AI technologies in the logistics sector are expected to drive the growth of artificial intelligence (AI) in logistics market during the forecast period. Moreover, AI companies have started developing new AI technologies for logistics operations and adopted several strategies such as product launches, partnerships, joint ventures, and some others, thereby driving the growth of Artificial Intelligence (AI) in logistics market.
Inaccessible data and diverse data sources
The integration of AI in logistics industry is an ongoing trend but there are some challenges associated with it. Firstly, the inaccessibility of appropriate data can lead to improper management of the supply chain. Secondly, the availability of data from unknown sources can also lead to the failure of the logistics sector. Thus, inaccessibility of data and complexity of diverse data sources is expected to restrain the growth of the Artificial Intelligence (AI) in logistics market.
Generative AI will shape the future of the logistics industry
The logistics industry has experienced several developments with the advancements in science and technologies. The developments in generative AI play an important role in the logistics industry for several operations. Some of the most important logistic operations include route optimization, demand, forecasting, warehouse & inventory management, supply chain automation, predictive maintenance, dynamic pricing, and others. Thus, the integration of generative AI in the logistics sector is expected to create ample growth opportunities for the Artificial Intelligence (AI) in logistics market players in the future.
The self-driving vehicles and forklifts segment held the largest market share in 2023 and is expected to continue its dominance during the forecast period. The growth of this segment is generally driven by the growing integration of AI in autonomous vehicles for the logistics industry. Also, the growing trend of AI-based forklifts for logistics industries is driving the growth of artificial intelligence (AI) in logistics market. Moreover, the rising development of self-driving trucks to streamline the supply chain and enhance the shipping process is likely to boost market growth.
The automation of ordering and processing segment is expected to be the fastest-growing segment during the forecast period. The growth of this segment is generally driven by the growing development in the retail and automotive industries. Also, the rising integration of AI and ML technologies in modern warehouses to automate order processing and other activities is likely to boost market growth. Moreover, AI service providers are launching new software for the automation of order processing in the logistics sector, which, in turn, drives the growth of Artificial Intelligence (AI) in logistics market.
The machine learning segment dominated the market in 2023 and is expected to grow at the fastest rate during the forecast period. The growth of this segment is generally driven by the growing development in logistics sectors across the world. Moreover, the adoption of machine learning technology for warehouse management and demand prediction has driven market growth. Also, ML technology is used to analyze traffic patterns and distances between different locations, which are important parts of logistics for route optimization and driving artificial intelligence (AI) in logistics market growth. The rising application of machine learning for workforce planning and fraud detection in payment systems, along with the development of machine learning-based systems for use in the logistics sector, is expected to boost market growth to some extent.
The contextual awareness segment is estimated to grow significantly during the forecast period. This segment is generally driven by rising demand for contextual awareness computing in the construction and retail industries. Also, the growing application of contextual awareness in the logistics sector to enhance the results of process mining drives market growth. Moreover, the rising use of contextual awareness computing in warehouses for security purposes is expected to boost the growth of Artificial Intelligence (AI) in logistics market.
The retail segment held the largest artificial intelligence (AI) in logistics market share in 2023. The growing number of online supermarkets across the world. Also, the rising proliferation of smartphones allows people to purchase retail goods from e-commerce stores, which, in turn, increases the demand for AI in logistics sectors, thereby driving market growth. Moreover, the role of AI in inventory management for synchronising online retail along with developing flexible logistics network drives the growth of market. Moreover, the rise in the number of e-commerce sites, along with the growing integration of AI by retail companies to streamline the demand and supply chain, is expected to drive Artificial Intelligence (AI) in logistics market growth during the forecast period.
The food and beverages segment is growing significantly during the forecast period. This segment is generally driven by the growing number of food and beverage companies across the world. Also, the rising development of AI related to warehouse management in the food and beverage industries is driving market growth. The growing application of AI to improve supply chain transparency and minimize food spoilage is driving the growth of AI in the logistics market. Moreover, rising advancements in AI for procurement services in the food and beverage industries, along with a growing number of partnerships among AI service providers and beverage companies, are likely to boost market growth.
Segments Covered in the Report
By Application
By Technology
By Industrial Vertical
By Geography
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