Australia Last Mile Delivery Market: Speed, Sustainability & Smarter Logistics Take Center Stage

Market Overview

• In 2024, the Australia last mile delivery market was valued at about USD 3,939.4 million.
• It is forecast to reach USD 8,641.1 million by 2033, growing at a CAGR of approximately 9.12% over 2025-2033.
• The market is segmented by delivery mode (regular, same-day/express), application (e-commerce; retail & FMCG; healthcare; mails & packages; others), service type (B2B, B2C, C2C), vehicle type (motorcycle, light & heavy commercial vehicles, drones), mode of operation (autonomous vs non-autonomous), and by region.
• Key drivers include the rapid rise of e-commerce, growing consumer demand for faster & more convenient delivery options, technology improvements (route optimisation, tracking, autonomous/delivery-vehicle innovations), urbanisation, and sustainability concerns.

Key Trends & Market Drivers

1. E-commerce Boom & Consumer Expectations

As Australians shop more online — in categories such as fashion, electronics, groceries, health & beauty, and beyond — expectations for fast, reliable delivery are rising. Same-day or next-day delivery are becoming key differentiators for retailers.

2. On-Demand & Same-Day / Express Delivery Growth

Platforms and retailers are investing in solutions that allow faster dispatch, localised fulfilment, and flexible delivery windows. Same-day delivery is no longer a niche offering—it’s growing in urban centers.

3. AI, Route Optimization & Orchestration Platforms

To reduce costs and improve efficiency, companies are leveraging AI-powered tools for route optimisation, order scheduling, and fleet management. A recent example: Shippit’s NowGo platform, adopted by large companies, has improved fleet utilisation and reduced fuel usage, driver downtime, and kilometers driven.

4. Electrification & Sustainability Measures

Environmental, Social & Governance (ESG) expectations are pushing last-mile delivery providers to adopt electric vehicles (EVs), invest in charging infrastructure, and reduce carbon footprints. One strong example: ANC’s “Project Spark,” backed by ARENA grants, aimed at converting owner-drivers’ trucks/vans to EVs.

5. Crowdsourcing & Driver Networks

Flexible delivery models using on-demand or crowdsourced driver networks help cope with peak demand, urban traffic, and delivery density. Platforms like eDelivery are building large driver networks for capacity scaling.

6. Tech-Driven Visibility & Customer Experience

Transparency via real-time tracking, tighter delivery windows, proactive notification, and better returns handling are increasingly valued. Consumers expect to know “where my order is” at every step.

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Opportunities in the Australia Last Mile Delivery Market

Scaling Electric & Low-Emission Fleets

Providers who invest in electric vans/trucks, or hybrid vehicles, and partner with government incentive programs (grants, subsidies, charging infrastructure) can reduce operating costs and meet ESG targets.

Expanding Express / Same-Day & Micro-Fulfilment

Urban micro-fulfilment centers and satellite warehouses that are closer to end customers reduce delivery time and cost. Retailers and 3PLs that build or leverage such facilities can gain competitive edge.

Investment in Delivery Orchestration Tools & AI

Platforms like Shippit’s NowGo and others present opportunities for efficiency gain: better utilisation of fleets, reducing fuel consumption, optimizing driver schedules, and improving service.

Diversified Delivery Modes

Use of drones, autonomous vehicles (where regulation permits), motorcycles, or electric bikes in congested urban areas to reduce time and emissions. Small-parcel/urgent healthcare & medical supplies delivery is an example.

Partnerships & Collaboration

Between retailers, logistics providers, government, and tech firms for shared infrastructure, e.g. shared delivery hubs, EV charging networks, or even collaborative delivery routing to reduce duplication.

Enhanced Customer Experience & Differentiation

Transparent tracking, flexible delivery windows (even time-slots), “click & collect” or locker-based pick-ups, flexible return options—all contribute to customer satisfaction and loyalty.

Recent News & Developments in the Australia Last Mile Delivery Market:

June 2024 – “Project Spark” by ANC

ANC announced a AUD 45.5 million plan (supported by a AUD 12.8 million grant from ARENA) aimed at helping owner-driver fleets adopt electric trucks and vans. The initiative is working to address cost & infrastructure barriers.

July 2025 – Shippit’s NowGo Platform Launch

Shippit unveiled its AI-powered delivery orchestration platform to boost efficiency in last-mile operations. Early adopters report improved fleet utilisation by ~15%, reduced fuel consumption and driver downtime. This reflects a broader shift toward tech-first logistics.

eDelivery Platform & Crowdsourced Driver Network

In late 2024 and early 2025, startup eDelivery prepared to launch a platform with web-based delivery tools plus a driver network (2,500+ couriers). Aimed to provide same-day delivery and on-demand capacity.

ANC Passes 100 EVs in Last-Mile Fleet

As of September 2025, ANC has moved over 100 electric vehicles into its , making up about 12.5% of its total fleet. The target is to reach 30% EV penetration by 2028. This highlights a real shift to greener operations.

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• Consumers now expect speed, reliability & transparency—what used to be a nice extra is now table stakes. Retailers and brands that fail to meet these expectations risk losing customers.
• Costs are rising (fuel, labor, emissions compliance), so operations that optimize routing, reduce empty-miles, electrify fleets, and improve utilisation are more likely to maintain margins.
• Regulatory and ESG pressures are not going away. Greenhouse gas emissions, urban pollution, noise & traffic impact are increasingly regulated or taxed. Early movers in sustainability (EVs, route consolidation, efficient operations) will have both compliance and brand image advantages.
• Urbanisation & infrastructure strain means that congestion, delivery windows, parking, zoning etc. will become more restrictive. Solutions like micro-hubs, locker pick-ups, alternative delivery modes will grow in importance.
• Technological enablers (AI, real-time tracking, autonomous/delivery modes) offer scale but require investment. Companies that leverage technology well can cut costs and improve customer satisfaction.