Australia Truck Market Size, Share Analysis and Forecast Report (2024-2032)

Australia Truck Market Trends

The shift towards sustainability has become a key driver increasing the Australia truck market value. While road trains and semi-trailers account for 1% of vehicles on Australia’s roads, they are responsible for nearly 15% of all vehicular emissions. An average passenger vehicle annually emits nearly 2.84 tons of CO₂, and a taxi 4.9 tons, a large truck can emit nearly 111 tons of CO₂ annually, while a medium-sized delivery truck can produce 16.2 tons. This indicates a significant need for the electrification of small, medium, and heavy-duty trucks to decarbonise the Australia domestic transportation market. As per the Australia truck market analysis, electrification of around 10 delivery trucks operating in urban areas can minimise emissions substantially, since a single road train emits 50x more emissions as compared to a passenger vehicle. This is equivalent to 56 households purchasing an EV to replace their ICE vehicle.

Rapid technological advancements in Fleet Management Systems (FMS) such as GPS tracking, fuel management, route planning, fleet maintenance, notifications and alerts, and driver behaviour management systems have radically transformed the trucking industry. Such advancements have enabled fleet owners to substantially enhance their operational safety and efficiency, which is expected to drive the market expansion in the forecast period.

Australia Truck Market Growth

The Australia truck market expansion is being driven by the growth of e-commerce networks, which account for nearly 9% of overall retail trade in Australia. Amazon (AU) (22.5 million monthly visits), Woolworths (20.4 million monthly visits), eBay (AU) (69 million monthly visits), JB Hi-Fi ((13.3 million monthly visits), Coles (10.7 million monthly visits), Kogan (10.2 million monthly visits), Big W (11.9 million monthly visits), Chemist Warehouse (9.1 million monthly visits), Officeworks (9.45 million monthly visits), and Catch (8.95 million monthly visits) are some of the leading e-commerce platforms in Australia. This is expected to raise the demand for trucks over the forecast period.

In 2021, Australia’s Truck Industry Council recorded the sales of heavy vans and trucks at 41,404 units, which was a year-on-year growth of 20.1% (or 6,928 vehicles). This growth was partly attributed to the increasing financial incentives offered by the federal government to the sector and the growth of e-commerce platforms and last-mile delivery channels. In 2021, the sale of vans and light trucks recorded a 10% growth from 2018 levels, indicating favourable Australia truck market dynamics.

Australia Truck Market Insights

• 1 in every 3 trucks in Australia belongs to Isuzu Motors Ltd.
• Foton is likely to bolster its production capacity for light-duty trucks, which is expected to reach over 150,000 units by 2025.
• In December 2021, overall sales of trucks and vans reached 3,528 in Australia.

Industry News

November 2023

The increasing adoption of the T5 EV light commercial truck model by companies such as Woolworth and Ikea has made Foton Mobility one of Australia’s leading providers of light-duty electric trucks. In 2023, it received over 200 orders for its vehicle, with a significant demand from the construction industry.

September 2024

MOV3MENT, an Australian group of transport industry consultants, announced a reward of $25,000 for the first small- to medium-sized fleet that achieves a 25% reduction in its carbon emissions before the start of 2026 using its methodology.

Australia Truck Market Drivers

Introduction of autonomous trucks

Autonomous trucks are expected to revolutionise the freight and logistics industry in Australia. Though substantial regulatory challenges surrounding their technical capabilities and safety levels remain, the introduction of autonomous trucks can reduce road traffic, minimise carbon emissions, and reduce the risk of human fatalities. Major trucking associations suggest that 94% of all truck accidents are a result of human error, which can be substantially minimised with the usage of sophisticated systems integrated into autonomous trucks. This is expected to drive the Australia truck market development in the coming years.

Growing trend of truck platooning

Truck platooning is a concept whereby a fleet of trucks is digitally connected to optimise the distance between them. This reduces traffic congestion and energy consumption caused by these vehicles. It also improved aerodynamic airflow by synchronising acceleration and braking across the platoon, resulting in cost savings of up to 4%-17% on fuels, depending on factors such as road conditions, speed variations, and vehicle position, among others. This is expected to favourably shape the Australia truck market trends and dynamics in the forecast period.

Opportunities in the Australia Truck Market

Emerging aerodynamic technologies provide significant opportunities for market growth

The Australia truck market dynamics are being favourably shaped by the introduction of TruckWings, which is an aerodynamic device that can reduce drag, enhance stability, and improve fuel efficiency among vehicles. When mounted upon an autombile (tractor), it can automatically close any gap between the trailer and the cab, thereby significantly reducing drag. This can result in fuel savings of 3%-6% while lowering carbon emissions.

Other add-on devices, such as vortex generators, boat trails, and side skirts can also play a critical role in driving the market growth. In-cab aerodynamic designs, which focus on minimising air resistance and maximising energy efficiency, are also gaining significant market traction, which is creating a favourable Australia truck market outlook.

Market Dynamics

The demand for trucks in Australia is expected to be favourably influenced by the growth of other industries, such as the agricultural sector. In 2020-21, the value of the Australian agricultural sector increased by 17% to reach $71 billion, as per the Australian Bureau of Statistics. This jump in agricultural productivity highlights the essential role of trucks in the transportation of raw materials to farmers and in ensuring a sustainable and efficient supply chain for distributors of agricultural commodities. Over the forecast period, the growth of allied industries, such as construction and mining, is expected to drive the market growth.

Market Restraints

The Australia truck market faces significant challenges from the prevailing government regulations regarding vehicles’ fuel efficiency standards. Regulations surrounding axle mass and truck width have made market entry for multinational corporations difficult in Australia. However, the Australian government is encouraging fleet manufacturers to shift towards electric trucks by providing attractive opportunities for receiving funding. In 2022, Team Global Express, a leading freight handling company, received an aid of $20 million from the Australian Renewable Energy Agency to purchase 60 BEV trucks from the Volvo Group.

Major Australian truck manufacturers who are exporting their vehicles to other lucrative markets, such as the United States, benefit from increasing tax incentives provided to commercial vehicle producers. This includes waiving off the tax leviable on nearly 30% of the automotive’s purchase price, or $US40,000, whichever is more. This is expected to create challenges for the domestic truck demand. However, the evolving regulatory landscape of Australia truck market is expected to drive the market growth.

Australia Truck Industry Segmentation

“Australia Truck Market Report and Forecast 2024-2032” offers a detailed analysis of the market based on the following segments:

Market Breakup by Vehicle Type

• Light Duty
• Medium Duty
• Heavy Duty

Market Breakup by Propulsion Type

• Gasoline
• Electric
• Diesel
• Natural Gas
• Others

Market Breakup by Application

• Industrial
• Commercial

Market Breakup by Region

• New South Wales
• Victoria
• Queensland
• Australian Capital Territory
• Western Australia
• Others

Australia Trucks Market Share

By Vehicle Type Analysis

The expansion of the construction and retail sectors is expected to propel the market growth

Heavy duty vehicles are expected to account for a major portion of the Australia truck market share due to the increasing government focus on infrastructure development projects. By 2032, the country is expected to boost its railway industry’s passenger handling capacity to 40,000 people per hour from 24,000 currently. This is expected to necessitate the deployment of large construction machines and earthmoving equipment, including trucks, thereby accelerating the market growth.

On the other hand, medium and light-duty vehicles are expected to witness a stable growth rate due to the robust performance of the retail industry. The establishment of new brick-and-mortar stores that enhance accessibility and convenience of grocery purchases for consumers is expected to drive the market growth in the forecast period.

By Propulsion Type Analysis

As per the Australia truck market analysis, electric propulsion is expected to dominate the market

Based on propulsion, the market is divided into gasoline, electric, diesel, and natural gas, among others. Over the forecast period, electric propulsion trucks are expected to grow at a CAGR of 10.7%, due to the increasing government emphasis on the shift towards sustainable transportation solutions. The Albanese government announced the creation of an $80 million fund (Driving the Nation fund) with the objective of decarbonising the heavy transportation industry and creating adequate hydrogen refuelling facilities on key freight routes. This is one of the key Australia truck market trends.

Other types of propulsion trucks, such as gasoline, diesel, and natural gas are expected to retain some portion of the market share, as the transition towards electric vehicles requires substantial investments, and major fleet companies are expected to rely on conventional truck models for operational benefits.

By Application Analysis

Rising Demand for Trucks in Industrial Applications is Aiding the Market

The industrial demand for trucks in Australia is expected to be driven by the growth of the mining and forestry industries, as heavy-duty trucks play a key role in the transportation of materials over large distances. Besides, to ensure the safety and efficiency of supply chain operations in remote rural areas, major retailing and logistics companies have boosted their reliance on commercial trucks, which is driving the Australia truck market development.

Australia Truck Market Regional Insights

The growth of the Australian freight industry is expected to raise the market growth. In 2022-23, the volume of domestic freight moved through roadways in Australia recorded a y-o-y growth of 3.0% and reached 241.8 billion tons per kilometre. Nearly 84-billion-ton km of this was attributed to New South Wales. Similarly, Melbourne, Victoria’s capital city, accounted for the largest portion of metropolitan road freight transportation in the country at 17.1 billion ton-km. The growth of freight volume across major highways located in Queensland, Western Australia, and the Australian Capital Territory is expected to boost the Australia truck market revenue over the forecast period.

Increasing investments in infrastructure projects is expected to drive the market growth in other regions of Australia. For instance, in the city of Perth situated in Western Australia, the government is implementing an A$10.5 billion project for the expansion of railways. Moreover, in Queensland, the government has invested A$13 billion to upgrade a 1673km long highway, with similar projects underway in the Australian Capital Territory. This is expected to drive the truck demand growth in Australia over the forecast period.

Australia Truck Market Regional Analysis

The Australia truck market exhibits significant regional variations, with rural areas (such as Queensland and Western Australia) witnessing a surge in demand for heavy-duty trucks across the mining and construction sector, while urban areas are recording a surge in demand for light-duty vehicles for logistical purposes. Rapid infrastructure development across metropolitan cities and the rapid growth of the agricultural industry are expected to play a critical role in driving the Australia truck market expansion over the forecast period.

Competitive Landscape

Market players are focused on product innovation, strategic alliances, and effective branding and marketing strategies to stay ahead of the competition. Companies in the market compete based on various factors such as product innovation, pricing, quality, brand reputation, distribution channels, and responsiveness to consumer trends.

Key Industry Players

PACCAR Australia Pty Ltd. is a subsidiary of PACCAR Inc. It was founded in 1966 and is headquartered in Melbourne, Victoria. It is organised into different business segments that are engaged in manufacturing premium commercial vehicles and providing aftermarket services, including PACCAR Parts, Kenworth, PACCAR Financial and PacLease, and DAF, among others.

Isuzu Australia Limited is a wholly-owned subsidiary of the Japanese company, Isuzu Motors Limited. It is engaged in marketing, distributing, and providing support services for Isuzu trucks in the country.

Komatsu Australia Pty Ltd. was founded in 1979 and is headquartered in Fairfield East, (New South Wales). It is a leading producer and supplier of heavy-duty vehicles, large equipment, and technological solutions for the construction, mining, forestry, mining, and forklift industries.

Scania Australia Pty Ltd. is headquartered in Campbellfield, Victoria. It is engaged in providing various sustainable transport solutions and services with a workforce of over 50,000 people across 100 different countries.

Other key players in the Australia truck market report include Daimler Truck Australia Pacific Pty Ltd., Hyundai Motor Company, Australia Pty Limited, Volvo Group Australia Pty Ltd., and Toyota Motor Corp. (Hino Motor Sales Australia Pty Ltd.), among others.

Recent Developments

July 2024

Mercedes-Benz launched the prime mover version of eActros, which continuously delivers an output of 443hp and can charge in just 75 minutes. It is equipped with advanced safety features, such as ABS, Lane Keeping, and Stability Control, and is expected to boost supply chain management operations for large scale retailers in Australia.

April 2021

Isuzu Motors completed the acquisition of UD Trucks from the Volvo Group for JPY 243 billion on a cash and debt free basis. This is expected to increase the range of opportunities for the former company, while improving the net cash position of the Volvo Group by SEK 19 billion.