Saudi Arabia Freight And Logistics Market

Saudi Arabia Freight and Logistics Market Size and Share:

The Saudi Arabia freight and logistics market size was valued at USD 55.3 Billion in 2024. Looking forward, IMARC Group estimates the market to reach USD 84.6 Billion by 2033, exhibiting a CAGR of 4.84% from 2025-2033. The market is driven by the Kingdom’s commitment to Vision 2030 to make digitalization efforts that streamline logistics operations, along with technological advancements in electric and hydrogen-powered trucks, supported by government policies, which are assimilated into freight fleets.

The growing regional trade activities are positively influencing the market in Saudi Arabia. They are fostering increased movement of goods within and across borders. Saudi Arabia's strategic location as a gateway between Asia, Europe, and Africa makes it a key hub for trade in the Gulf Cooperation Council (GCC) and the broader Middle Eastern region. The country actively strengthens regional trade ties through agreements, which lead to a rise in demand for freight forwarding, warehousing, and transportation services. The development of mega-projects across the region increases trade activities by creating new avenues for regional commerce. These projects necessitate advanced freight transport and logistics solutions to manage the inflow and outflow of construction materials, machinery, and goods.

In Saudi Arabia, the rising reliance on third-party logistics (3PL) providers is impelling the market growth. With businesses outsourcing logistics operations to specialized 3PL providers, efficiency and cost-effectiveness have become primary benefits. These providers offer a comprehensive suite of services, including transportation, warehousing, freight forwarding, and distribution, allowing companies to focus on core activities while ensuring seamless supply chain management. These companies are essential for managing complex logistics, handling customs clearance, and optimizing routes for international trade. With the expansion of e-commerce platforms and high user demand, 3PL providers enable businesses to meet fast delivery expectations through advanced technologies and last-mile delivery expertise.

Saudi Arabia Freight and Logistics Market Trends:

Vision 2030 digital transformation initiatives:

Digital transformation is changing how businesses operate and enhance overall efficiency. Advanced technologies like the Internet of Things (IoT), artificial intelligence (AI), and blockchain are employed to streamline supply chain processes and enable real-time tracking, inventory management, and predictive analytics. These tools are important for reducing costs and enhancing user satisfaction, as they provide transparency and reliability in logistics operations. The Kingdom’s commitment to Vision 2030 enhances digitalization efforts, with initiatives focused on building smart logistics hubs and adopting cutting-edge technologies. Digital platforms and automation help to optimize freight routes and improve last-mile delivery. Companies integrate digital payment systems, order management tools, and user portals to enable quick and reliable delivery services. Additionally, partnerships between local businesses and worldwide tech firms bring innovative solutions. Government agencies invest in enhancing the capabilities of AI to make logistics systems more reliable. According to the article published on the official website of the International Trade Administration in September 2024, the expenditure on AI in Saudi Arabia is expected to exceed $720 million in 2024 and will hit $1.9 billion by 2027, growing at a CAGR of 40%, with 50% of that allocated to interpretative AI. Saudi Arabia's emphasis on AI within its Vision 2030 framework offers substantial prospects for companies that can provide AI-based solutions in areas like healthcare, manufacturing, finance, and logistics.

Infrastructure development of ports

Ports serve as vital hubs for international trade and supply chain operations. Key ports across the region facilitate the movement of goods to encourage more trade volume and logistics activities. Modernization efforts enhance efficiency, reduce turnaround times, and attract international shipping lines. The development of specialized terminals for containerized, bulk, and liquid cargo accommodates diverse industries, ranging from petrochemicals to consumer goods. Besides this, integrated port infrastructure connects seamlessly to road, rail, and air networks, enabling efficient last-mile delivery and inland distribution. Partnerships with global logistics firms and investments in free zones around ports also stimulate regional economic growth by providing robust connectivity and world-class facilities. In August 2024, Maersk, the prominent leader in container shipping and logistics, teamed up with the General Ports Authority of Saudi Arabia to unveil a 225,000 sq m logistics center at Jeddah Islamic Port, with an investment of USD 250 Million. The large park offers a range of services in one location, such as multi-modal links between sea, land, and air transport, warehousing options for business-to-business (B2B) and e-commerce needs, climate-controlled storage, and distribution services featuring first- and last-mile deliveries.

Rising adoption of sustainable logistics practices

The increasing adoption of sustainable logistics practices is propelling the market growth. Logistics companies adopt green initiatives, such as optimizing transportation routes, using fuel-efficient vehicles, and integrating renewable energy into their operations. These practices help to reduce carbon footprints, comply with international environmental regulations, and enhance operational efficiency. Advancements in electric and hydrogen-powered trucks, supported by government policies, are being actively integrated into freight fleets. Warehousing operations utilize energy-efficient systems and smart technology, which optimize space and reduce energy consumption. This focus on sustainability attracts environment conscious businesses to invest in the Kingdom’s logistics infrastructure. These initiatives foster long-term growth and attract international collaborations. In May 2024, Emaar collaborated with Aramex, one of the leading providers of all-inclusive logistics and transportation solutions to devise plans for executing value-added and sustainable logistics solutions in King Abdullah Economic City (KAEC).

Saudi Arabia Freight and Logistics Industry Segmentation:

IMARC Group provides an analysis of the key trends in each segment of the Saudi Arabia freight and logistics market, along with forecasts at the country and regional levels from 2025-2033. The market has been categorized based on logistics function and end use industry.

Analysis by Logistics Function:

• Courier, Express and Parcel
  • By Destination Type
    • Domestic
    • International
• Freight Forwarding
  • By Mode of Transport
    • Air
    • Sea and Inland Waterways
    • Others
• Freight Transport
  • By Mode of Transport
    • Air
    • Pipelines
    • Rail
    • Road
    • Sea and Inland Waterways
• Warehousing and Storage
  • By Temperature Control
    • Non-Temperature Controlled
    • Temperature Controlled
• Others
   

The courier, express and parcel [by destination type (domestic and international)] section benefits from the expansion of e-commerce platforms and high demand for quick deliveries. These services ensure swift and reliable delivery of packages, ranging from documents to online orders to cater to both individuals and businesses. It utilizes advanced tracking systems to streamline operations and provide timely logistics solutions.

Freight forwarding [by mode of transport (air, sea and inland waterways, and others)] in Saudi Arabia assists in managing the complex supply chain processes for businesses. This segment handles the organization and transportation of goods across borders, leveraging expertise in customs clearance, documentation, and compliance. The Kingdom's strategic location as a trade hub enhances the importance of freight forwarding services. Companies rely on these services for seamless global trade, benefiting from efficient networks and cost-effective solutions.

Freight transport [by mode of transport (air, pipelines, rail, road, and sea and inland waterways)] is the backbone of Saudi Arabia's logistics industry, which enables the movement of goods within and beyond the country's borders. Government agencies invest in mega projects and the development of transport infrastructure to enhance connectivity, making freight transport a critical enabler of Saudi Arabia's economic ambitions.

Warehousing and storage [by temperature control (non-temperature controlled and temperature controlled)] are important across the area, as businesses require efficient inventory management. These facilities store raw materials, finished goods, and e-commerce products that need effective logistics solutions for transit. Modern warehouses also offer advanced technologies, such as automated systems and climate-controlled environments.

Analysis by End Use Industry:

• Agriculture, Fishing and Forestry
• Construction
• Manufacturing
• Oil and Gas, Mining and Quarrying
• Wholesale and Retail Trade
• Others
   

In Saudi Arabia, the agriculture sector depends mainly on freight and logistics to ensure that fresh products arrive on time. With high demand for local and imported agricultural goods, logistics providers use efficient cold chain systems to preserve fruits, vegetables, and other perishable items. Enhanced storage facilities and streamlined transportation networks help to reduce waste and meet different needs.

The fishing and forestry industries in Saudi Arabia rely on freight and logistics services to keep things running smoothly. From transporting freshly caught seafood to moving timber and related forestry products, efficient logistics are very important. Cold chain solutions are employed to preserve the freshness of fish and seafood during transit, while specialized transport handles bulky forestry materials.

In the construction industry in Saudi Arabia, there is a high number of mega projects like NEOM and The Red Sea Project that depend on robust freight and logistics services. This segment facilitates the movement of building materials, such as steel, cement, and heavy machinery to construction sites. Reliable and timely delivery is critical for maintaining project schedules.

The manufacturing, oil and gas industries in Saudi Arabia encourage the use of freight and logistics solutions for the smooth movement of goods and resources. For manufacturing, logistics support the transport of raw materials, finished products, and machinery to ensure timely delivery across the country. In the oil & gas sector, logistics are vital for moving equipment, raw materials, and fuel across vast distances, especially to remote locations.

The mining and quarrying sector in Saudi Arabia depends on freight and logistics systems for moving minerals, ores, and heavy machinery. Key resources like gold, phosphate, and bauxite require efficient supply chains to reach processing facilities and export terminals. Freight transport solutions, including rail and sea freight, are pivotal in this segment.

The wholesale and retail trade industry requires a well-setup logistics system to meet the rising demand for goods. E-commerce and retail outlets rely on the timely delivery of products, ranging from fashion and electronics to groceries. This encourages the employment of warehousing and last-mile delivery solutions. As user preferences evolve, the logistics industry adapts by offering faster, more efficient, and scalable solutions to keep up with the dynamic wholesale and retail landscape in Saudi Arabia.

Regional Analysis:

• Northern and Central Region
• Western Region
• Eastern Region
• Southern Region
   

The Northern and Central Region includes Riyadh, which is well-known for its reliable freight and logistics network. This area has a high number of government activities as well as manufacturing and trade projects to improve road networks and strategic connectivity. Freight services here cater to industries like construction, agriculture, and retail, ensuring the smooth movement of goods.

The Western Region, anchored by Jeddah and Makkah, takes advantage of vibrant trade and tourism activities. With access to the Red Sea and Jeddah Islamic Port, this region is a key entry point for imports and exports. People embark on the Hajj and Umrah pilgrimages where essentials are supplied via logistics solutions for millions of visitors annually.

The Eastern Region is known for its oil and gas dominance, which relies on effective freight and logistics systems. With Dammam’s King Abdulaziz Port and the region’s high petrochemical innovations, this area is a hub for industrial freight and worldwide trade. Logistics services cater to the transport of heavy machinery, refined products, and raw materials.

The Southern Region holds importance in the logistics landscape due to its agricultural exports and mining activities. This region depends on freight services to connect its products and minerals to domestic and international markets. Logistics providers in this area focus on improving road connectivity and cold chain solutions for agricultural goods.

Competitive Landscape:

Key players are leveraging advanced technologies, expanding infrastructure, and fostering innovation. Companies are focusing on streamlining supply chains, improving last-mile delivery, and integrating digital solutions for efficiency. Major players are placing bets on enhancing trade facilitation by optimizing port logistics and freight forwarding services. Regional players are emphasizing innovations in logistics solutions with localized expertise and tailored services. They are wagering on warehousing, transport, and multimodal networks to meet the high demands from key sectors like e-commerce, oil and gas, and manufacturing. They are also indulging in strategic partnerships and government collaborations to support economic diversification and trade connectivity. For instance, in November 2024, GWC, a well-known company that delivers solutions to clients in the energy sector, partnered with Offshore Fabrication Company (OFC), based in Saudi Arabia, to build 100,000 sqm logistics facilities at Ras Al-Khair Port. This agreement aims to enhance their energy supply chain solutions and deliver customer-centric needs.

The report provides a comprehensive analysis of the competitive landscape in the Saudi Arabia freight and logistics market with detailed profiles of all major companies.

Latest News and Developments:

• March 2024: Aramex established a new regional headquarters in Riyadh, Saudi Arabia to improve its capabilities to serve businesses across the region. This facility will strengthen its dedication to innovation that will aid the Saudi logistics sector and support Vision 2030’s focus on enhancing digital capabilities and development.
• June 2024: Mile Solutions, a multimodal logistics platform, teamed up with Premium Shipping, a famous delivery and warehousing services provider in the Kingdom of Saudi to enhance deliveries among a fleet of numerous drivers and effortlessly unify operations across every department in major cities of the Kingdom of Saudi Arabia (KSA). Arabia Mile’s flagship product will automate storage, fulfillment, and delivery processes in various cold chain and standard warehouse facilities.
• July 2024: CEVA Logistics, a prominent leader in third-party logistics made an announcement about its collaboration with Almajdouie Logistics, an end-to-end logistics solutions provider by signing a joint venture (JV) agreement. They aspire to extend their logistics capabilities and provide end-to-end integrated logistics solutions in Saudi Arabia.
• July 2024: DB Schenker, the worldwide logistics and transportation solutions provider set an alliance with Kaden, a real estate development company, to invest in logistics infrastructure development in Saudi Arabia. The initial phase of this large-scale project will take place in the city of Jeddah. Both companies will work together to create custom-designed warehouses and logistics facilities.

Saudi Arabia Freight and Logistics Market Report Scope:

Key Benefits for Stakeholders:

• IMARC’s report offers a comprehensive quantitative analysis of various market segments, historical and current market trends, market forecasts, and dynamics of the Saudi Arabia freight and logistics market from 2019-2033.
• The research study provides the latest information on the market drivers, challenges, and opportunities in the Saudi Arabia freight and logistics market.
• Porter's Five Forces analysis assists stakeholders in assessing the impact of new entrants, competitive rivalry, supplier power, buyer power, and the threat of substitution. It helps stakeholders to analyze the level of competition within the Saudi Arabia freight and logistics industry and its attractiveness.
• Competitive landscape allows stakeholders to understand their competitive environment and provides an insight into the current positions of key players in the market.