As electric vehicles (EVs) become more prevalent in the logistics industry worldwide, Portland-based market research firm Allied Market Research (AMR) predicts that the global ‘Green Logistics Market’ will hit $2.9 trillion by 2032 at a compound annual growth rate (CAGR) of 8.3%.
Sustainable or green logistics is defined as any practice that minimizes the environmental impact of logistics and delivery networks, and has become a “growing imperative” in business.
According to its July 2023 report, 57% of consumers are willing to change their ecommerce purchasing habits to help reduce their environmental impact. From this finding, AMR concludes that companies are rapidly adjusting their supply chains and logistics systems to meet these new and higher sustainability expectations.
The same study also details the green logistics industry’s four primary drivers of growth: (1) increased corporate social responsibility (CSR) activities by logistic companies, (2) the growing accessibility of EVs in the logistics industry, (3) the rise in government incentives stemming from environmental regulations and legislation, and (4) increase in adoption of artificial intelligence (AI) in the global logistics industry.
Jeffrey Hermann, Chairman and CEO of the New Jersey-based logistics company Hermann Services, weighs in on the numerous benefits of sustainable and green logistics within the report.
“First and foremost, these practices are essential for protecting the environment and reducing the impact of logistics operations on the planet. In addition, they can also lead to cost savings for companies by reducing energy consumption, minimizing waste, and optimizing transport routes. Furthermore, sustainable practices can also improve brand reputation and customer loyalty, as consumers are increasingly looking for products that are environmentally friendly,” said Hermann.
If AMR’s prediction of the future of the global supply chain industry is accurate, then logistics companies should start investing in robust, AI-powered solutions and green strategies today to keep their competitive edge.