UNITED STATES CROSS-BORDER ROAD FREIGHT TRANSPORT MARKET - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)
The United States cross-border road freight transport market is driven by the growing technological advancement in the trucking industry and the trade agreements among the North American countries, while road congestions and high emissions drag the market growth down.
Key HighlightsNAFTA is a trilateral trade agreement that allows smooth trade between the United States, Canada, and Mexico without any barriers and by reduction of tariffs on selected goods. Additionally, it supported the economic growth in the region and led to many employment opportunities.
This agreement is the significant factor driving the trade between these three countries, and most of the trade flows take place by road. According to the American Trucking Association (ATA), the trade through NAFTA contributes almost USD 6.6 billion to the revenue of the trucking industry and 31,000 jobs per year.
NAFTA, since its introduction in 1994, has resulted in the rise of trade between the three countries, making their counterparts in North America as their major trading partners. The total imports of each country from their partners increased by threefold, since the introduction of the NAFTA. The trade between these three countries reached approximately USD 1 trillion in 2016.
The most used mode of trade through NAFTA is road transportation. In 2017, out of the total trade of USD 1,139 billion, the total goods worth USD 720.81 billion were transported through trucks, which accounted to 63.3%, when compared to 65.5% (in terms of value) in 2016.
Cross-border Freight TransportThe road freight movement of goods is the dominant mode of transportation in the United States and is an important factor for the economic growth. The transportation and warehousing sector contributed 3% to GDP in 2017. More than 50% of freight to North America from the United States is carried through trucks.
The strong and developed economy, well-developed transport infrastructure and trucking industry, and the trade through NAFTA are the major drivers for road freight movement in the United States.
The freight demand is expected to proliferate in the future. The total weight of shipments transported domestically by all modes is expected to reach 20,940 million metric ton by 2045, out of which 14,235 million metric ton is expected to be transported by trucks.
The trucking industry in the United States is one of the biggest in the world. There are approximately 3.5 million professional truck drivers in the country, according to the American Trucking Association (ATA).
The country’s trade with Canada and Mexico, by road, is also expected to rise in the future. In 2017, 41.9 million metric ton of shipments were transported to Mexico through trucks, whereas 57 million metric ton were transported to Canada.
Competitive LandscapeThe United States cross-border road freight transport market is a highly competitive market, with major international players present in the market. The market is moderately fragmented with many new players.
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