Vietnam Freight and Logistics Market Outlook to 2030

Vietnam Freight and Logistics Market Overview

• The Vietnam Freight and Logistics market is valued at USD 48 billion, driven by its increasing integration into global trade and expanding infrastructure development. The market has grown substantially over a five-year historical analysis, largely due to the government's commitment to improving transport infrastructure, coupled with rising demand from e-commerce and manufacturing industries.

• Key cities such as Ho Chi Minh City, Hanoi, and Da Nang dominate the market. These cities act as significant hubs for both domestic and international freight movements due to their well-established transport infrastructure, large industrial clusters, and proximity to major ports. Ho Chi Minh City, for instance, is home to the busiest port in Vietnam, accounting for a large portion of the countrys import and export trade.
• The Vietnamese government is rolling out a comprehensive National Logistics Master Plan that aims to modernize the countrys logistics infrastructure and improve connectivity. By 2024, the government will invest $30 billion in projects such as deep-sea ports and road networks, enhancing freight mobility and reducing logistics costs by up to 10% over the next five years.

Vietnam Freight and Logistics Market Segmentation

By Mode of Transport: The market is segmented by mode of transport into road freight, rail freight, air freight, and sea freight. Among these, sea freight holds the largest share, driven by Vietnam's extensive coastline and its strategic importance for international trade. The presence of major ports such as Hai Phong and Tan Cang-Cat Lai Port in Ho Chi Minh City allows sea freight to dominate the logistics market, handling the bulk of imports and exports. Sea freight's dominance is further reinforced by increasing investments in port infrastructure to accommodate larger vessels and improve handling efficiency.

By Service Type: The market is segmented by service type into transportation, warehousing and distribution, and value-added services such as customs clearance and packaging. Transportation services dominate the market, accounting for the largest share due to the high demand for efficient and cost-effective goods movement. The rapid expansion of the e-commerce sector, manufacturing, and cross-border trade in Vietnam has accelerated the need for reliable transportation services. Companies continue to focus on expanding their fleet sizes, enhancing their supply chain capabilities, and integrating technology to optimize operations, which has further solidified transportation as the leading service type in the logistics industry.

Vietnam Freight and Logistics Market Competitive Landscape

The market is characterized by a mix of local and global players, with a few large companies dominating the market. Key players like Gemadept Corporation and Transimex Corporation lead the market due to their extensive logistics networks and investments in technology to enhance operational efficiency.

Vietnam Freight and Logistics Market Analysis

Market Growth Drivers

• Increased Trade Agreements: Vietnam has engaged in several free trade agreements (FTAs), including the Regional Comprehensive Economic Partnership (RCEP), and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). In 2024, these agreements are expected to contribute to substantial growth in trade volumes, particularly in sectors like electronics and textiles.
• Infrastructure Development Projects: The Vietnamese government has been heavily investing in infrastructure projects to improve connectivity. In 2024, projects such as the North-South Expressway and the Long Thanh International Airport are projected to come closer to completion, boosting the capacity to handle cargo.
• Growing Manufacturing Output: Vietnam has become a global manufacturing hub, particularly for electronics and apparel. By 2024, the countrys manufacturing output is expected to reach $300 billion, with exports contributing to logistics demands. The increase in manufacturing activity will lead to an additional 1 million containers being moved through Vietnams ports each year, requiring the logistics sector to expand and improve efficiency in order to meet global standards.

Market Challenges

• Underdeveloped Cold Chain Logistics: Vietnams cold chain logistics infrastructure is underdeveloped, limiting the transportation of perishable goods like seafood and pharmaceuticals. By 2024, the demand for cold storage is expected to rise by over 500,000 tons, but limited availability and poor connectivity pose challenges to meeting this demand, especially in remote areas.
• Traffic Congestion in Major Cities: Ho Chi Minh City and Hanoi, Vietnam's largest logistics hubs, face severe traffic congestion, which delays freight transportation. In 2024, urban freight movement is projected to increase by 7 million tons, but current road infrastructure struggles to handle this growth.

Vietnam Freight and Logistics Market Future Outlook

Over the next five years, the Vietnam Freight and Logistics industry is expected to experience growth driven by increasing international trade, the rise of the e-commerce sector, and government initiatives to enhance logistics infrastructure.

Future Market Opportunities

• Increased Investments in Automated Warehousing: Automated warehousing will become a critical investment area for logistics companies in Vietnam. By 2026, over 1,000 automated warehouses are expected to be operational, increasing inventory management efficiency and reducing manpower requirements by 15%. This shift will help logistics firms meet growing demands while optimizing operational costs.
• Development of Inland Waterways for Freight Movement: Vietnam is expected to increase its reliance on inland waterways for freight transportation as a more cost-effective and environmentally friendly alternative. By 2029, over 25 million tons of goods will be moved annually via inland waterways, reducing the pressure on congested road networks and lowering logistics costs.