Market Trends of Saudi Arabia Refrigerated Truck Industry
Heavy Commercial Vehicle (HCV) increase the Demand in the Market
The Heavy Commercial Vehicle (HCV) segment holds significant importance in the Saudi Arabia refrigerated truck market, as these vehicles play a crucial role in the transportation of perishable goods across the nation. The recent market overview has shown a steady growth in the demand for HCVs in the refrigerated truck industry due to various factors such as expanding logistics infrastructure, increasing trade activities, and a growing consumer preference for fresh and high-quality products. In 2022, 97,006 commercial vehicles were sold, which was a 49.54% growth compared to 2020 (64835 units).
Several driving factors contribute to the increasing demand for Heavy Commercial Vehicles (HCVs) in the Saudi Arabian refrigerated truck market. Firstly, the country's strategic location as a trade hub between Asia, Europe, and Africa has led to a surge in import and export activities, necessitating the need for efficient transportation solutions. In 2022, the number of trucks departing from Saudi Arabia via the King Fahd Bridge was around 183 thousand trucks, up from around 166 thousand trucks in 2020. Additionally, the rapid urbanization and economic growth in the region have led to an increase in the demand for food and other essential goods, further fuelling the need for HCVs in the refrigerated truck market.
Besides, One of the significant challenges faced by the industry is the need for improved fuel efficiency and environmental sustainability. As global concerns about climate change and air pollution continue to grow, there is an increasing demand for eco-friendly transportation solutions. This presents an opportunity for manufacturers and service providers to invest in research and development of more energy-efficient and environmentally friendly HCVs.
As the market evolves, we will likely witness advancements in technology, infrastructure, and operational efficiency, which will further boost the demand for HCVs. However, stakeholders must address the challenges associated with sustainability and environmental impact to ensure long-term growth and success in this market.
Expansion of Food and Beverages industry is anticipated the market demand
The refrigerated truck market in Saudi Arabia is experiencing substantial growth due to the significant influence of the food and beverage (F&B) industry. The F&B market in Saudi Arabia is primarily demand-driven, with limited scope for local agricultural production, high disposable income, and exposure to diverse culinary traditions. Consequently, F&B imports hold paramount importance in the sector. With only 1.5% of the land area classified as arable, the country cannot meet the local market demand for agri-food products, let alone cater to the growing preference for product variety. The harvested area in Saudi Arabia is significantly less than 1 million hectares (10,000 km²) in comparison to other markets with similar geographies like Mexico and Iran.
Although food and beverage imports constitute the major portion, local food processing in Saudi Arabia holds significance. In 2022, the country imported approximately USD 3 billion worth of intermediate food products, with the United States supplying approximately 11% of the total. This continuous growth in the industry has led to a higher demand for temperature-controlled transportation, thereby fueling the growth of the refrigerated truck market.
Several factors contribute to the increasing number of F&B refrigerated trucks in Saudi Arabia. The expanding retail sector, including supermarkets, hypermarkets, and convenience stores, necessitates a steady supply of fresh and chilled products. This, in turn, drives the demand for refrigerated trucks to transport goods efficiently. Additionally, the rise in food service businesses like restaurants, cafes, and catering services requires temperature-controlled transportation to ensure product quality and safety. Furthermore, the government's efforts to diversify the economy and reduce dependence on oil have led to the growth of various industries, including F&B, which in turn boosts the demand for refrigerated trucks.
Manufacturers can focus on developing advanced and energy-efficient refrigeration systems that can withstand extreme temperatures and reduce maintenance costs. Investing in better logistics infrastructure and improving cold chain management can help overcome distribution challenges and enhance overall market efficiency. Given the growing demand for diverse food products and the government's commitment to economic diversification, the future of the F&B refrigerated truck market in Saudi Arabia appears promising. As the retail and foodservice industries continue to grow, the need for efficient temperature-controlled transportation will also increase.
Moreover, technological advancements and the adoption of sustainable practices are expected to drive innovation in the refrigerated truck market. This may involve the development of electric or hybrid refrigerated trucks, which can reduce emissions and lower operating costs. In conclusion, the F&B refrigerated truck market in Saudi Arabia is anticipated to expand significantly in the coming years, driven by the dynamic growth of the F&B industry and the nation's commitment to economic diversification.
