Malaysia Logistics and warehousing Market Outlook to 2029

The report titled “Malaysia Logistics and Warehousing Market Outlook to 2029 - By Market Structure, By Services (Transportation, Warehousing, Value-added Services), By End User Industries, By Modes of Transportation, and By Region” provides a comprehensive analysis of the logistics and warehousing sector in Malaysia. The report covers an overview and genesis of the industry, overall market size in terms of revenue, market segmentation; trends and developments, regulatory landscape, customer level profiling, issues and challenges, and comparative landscape including competition scenario, cross comparison, opportunities and bottlenecks, and company profiling of major players in the Logistics and Warehousing Market. The report concludes with future market projections based on market revenue, by service lines, end-user industries, region, cause and effect relationships, and success case studies highlighting the major opportunities and challenges.

Malaysia Logistics and Warehousing Market Overview and Size

The Malaysia logistics and warehousing market was valued at approximately MYR 72 Billion in 2023, driven by rising e-commerce penetration, infrastructure development under the 12th Malaysia Plan, and the country’s strategic geographical location as a regional transshipment hub. The market is characterized by the presence of established players such as GD Express, Pos Malaysia, DHL, FM Global Logistics, and YCH Group. These companies are recognized for their expansive warehousing capacity, multi-modal logistics capabilities, and integrated technology platforms.

In 2023, Pos Malaysia launched a digital transformation initiative to optimize last-mile delivery and enhance visibility across its logistics chain. This move aims to meet the increasing demand for efficient e-commerce delivery and position the company as a leader in digital logistics. Key markets such as Klang Valley, Penang, and Johor Bahru remain logistics hotspots due to their industrial concentration and access to port infrastructure.

What Factors are Leading to the Growth of the Malaysia Logistics and Warehousing Market:

• E-commerce Boom: The surge in online shopping has created strong demand for agile and scalable logistics networks. In 2023, over 22 million Malaysians shopped online, contributing significantly to growth in third-party logistics (3PL) and fulfillment services. The last-mile delivery segment has grown by over 30% YoY, fueled by express delivery requirements from platforms like Lazada, Shopee, and TikTok Shop.

• Government Infrastructure Push: Government initiatives under the National Transport Policy and the 12th Malaysia Plan have catalyzed logistics development. Investments in East Coast Rail Link (ECRL), Pan Borneo Highway, and port expansion projects are enabling seamless inter-regional freight movement. In 2023, logistics infrastructure investment was estimated to exceed MYR 7 Billion.

• Industrial and Trade Expansion: Malaysia's growing role in global supply chains, especially in electronics, F&B, and automotive sectors, is boosting demand for integrated logistics and warehouse services. Export-oriented manufacturing contributed 65% of logistics demand in 2023. The emergence of Free Commercial Zones (FCZs) and bonded logistics parks is attracting multinational players to set up regional distribution hubs.

Which Industry Challenges Have Impacted the Growth for Malaysia Logistics and Warehousing Market

• High Operating Costs: Rising fuel prices, labor shortages, and escalating rental costs for warehousing space have posed major operational challenges. In 2023, logistics providers in Malaysia faced an average 10–12% increase in operating expenses compared to the previous year, primarily due to volatile fuel prices and wage inflation. This has squeezed margins, especially for small and medium logistics firms.

• Fragmented Market Structure: The Malaysian logistics market remains highly fragmented, with over 70% of logistics firms being small-scale operators lacking advanced technological capabilities and integrated networks. This fragmentation often leads to inefficiencies, lack of standardization, and difficulty in maintaining service quality across regions, affecting the overall competitiveness of the sector.

• Infrastructure Bottlenecks: Despite major government investments, logistical infrastructure in rural and eastern regions remains underdeveloped. In 2023, over 35% of warehousing demand in East Malaysia remained unmet due to poor road connectivity and lack of large-scale storage facilities. These challenges result in delays, increased transit times, and higher costs for long-haul logistics providers.

What are the Regulations and Initiatives which have Governed the Market

• National Transport Policy (2019–2030): The Malaysian government introduced this policy to promote an efficient, integrated, and sustainable transport system. It aims to modernize logistics infrastructure, enhance digitalization, and attract foreign investment. As of 2023, over MYR 2.5 Billion in logistics-related infrastructure projects had been initiated under this framework.

• Investment Incentives for Warehousing: The Malaysian Investment Development Authority (MIDA) offers various tax incentives, including Pioneer Status and Investment Tax Allowance (ITA) for companies investing in integrated logistics services and cold chain facilities. In 2023, more than 80 logistics firms benefited from these incentives to expand their storage capacity and automation capabilities.

• Digital Free Trade Zone (DFTZ): This initiative is designed to facilitate seamless cross-border trade and empower Malaysian SMEs through digitalization. As of 2023, over 1,800 Malaysian businesses had joined the DFTZ platform, enhancing their logistics connectivity for e-commerce exports. The program also streamlined customs clearance, reducing clearance time by up to 48%.

Malaysia Logistics and Warehousing Market Segmentation

• By Market Structure: The logistics sector in Malaysia is primarily dominated by Third-Party Logistics (3PL) providers, who manage integrated warehousing, transportation, and value-added services. These companies offer scalability, advanced technology integration, and strong distribution networks across the country. However, a significant portion of the market is still held by independent logistics operators and small-scale freight forwarders, especially in rural and less industrialized regions. These players often operate on a contract basis and are preferred by SMEs due to lower costs and flexible service offerings.

• By Services: Transportation services form the largest segment, accounting for a major share due to Malaysia’s position as a trading hub. These services include road freight, air freight, sea freight, and rail transport. Warehousing services have witnessed rapid growth, driven by increasing demand from e-commerce, FMCG, and pharmaceutical sectors. The emergence of value-added services such as packaging, labelling, inventory management, and reverse logistics is also becoming crucial for companies seeking customized logistics solutions.

• By End User Industry: The e-commerce sector is the fastest-growing end-user segment, contributing significantly to the surge in warehousing and last-mile delivery demand. Retail and FMCG industries follow, supported by increasing domestic consumption and rapid urbanization. The automotive, pharmaceutical, and electronics sectors are also key demand drivers due to their reliance on just-in-time (JIT) inventory and temperature-sensitive logistics capabilities.

Competitive Landscape in Malaysia Logistics and Warehousing Market

The Malaysia logistics and warehousing market is moderately fragmented, with a mix of multinational corporations, regional players, and specialized service providers. While large integrated logistics firms dominate industrial and cross-border operations, the rise of technology-driven 3PL and last-mile delivery startups has diversified the competitive landscape. Major players include GD Express, Pos Malaysia, DHL Express Malaysia, FM Global Logistics, YCH Group, TheLorry, Ninja Van, and J&T Express.

Some of the recent competitor trends and key information about major players include:

• GD Express (GDEX): Known for its strong presence in domestic courier services, GD Express handled over 150 million parcels in 2023. It expanded its warehousing footprint in Klang Valley and introduced AI-based route optimization to improve delivery efficiency.

• Pos Malaysia: The national postal and logistics provider, Pos Malaysia, recorded a 20% growth in e-commerce-related parcel volume in 2023. It launched its “SendParcel” digital platform to streamline customer orders and strengthen its B2C logistics business.

• DHL Express Malaysia: A global logistics leader, DHL expanded its express delivery hubs and integrated cold chain services in 2023. The company also invested in green logistics, deploying electric delivery vans in Kuala Lumpur and Johor Bahru.

• FM Global Logistics: This Port Klang-based company strengthened its freight forwarding and contract logistics capabilities. It secured long-term warehousing contracts with electronics and FMCG clients, driving a 12% YoY increase in warehousing revenue in 2023.

• YCH Group: Operating regional supply chain hubs in Malaysia, YCH continued its Smart Logistics initiative, incorporating IoT and real-time data analytics into its warehouse management systems. It also partnered with state governments to develop logistics parks in underserved regions.

• TheLorry: A logistics tech startup specializing in on-demand truck and van booking services, TheLorry expanded its SME customer base and launched real-time freight tracking features. In 2023, it facilitated over 600,000 intercity deliveries across Peninsular Malaysia.

• Ninja Van: Focused on last-mile delivery for e-commerce, Ninja Van increased its delivery fleet by 20% in 2023 and expanded its presence in East Malaysia. The company also introduced predictive analytics to reduce failed delivery rates.

• J&T Express: A major player in parcel logistics, J&T Express opened new distribution centers in Johor and Sabah. It handled over 300 million parcels in 2023, supported by automated sorting systems and extended cut-off times for urban deliveries.

What Lies Ahead for Malaysia Logistics and Warehousing Market?

The Malaysia logistics and warehousing market is projected to witness steady growth through 2029, driven by expanding e-commerce volumes, robust infrastructure development, and government support for trade facilitation. The market is expected to grow at a healthy CAGR, fueled by technological advancements and the increasing complexity of supply chains.

• Expansion of Cold Chain Logistics: With growing demand from the pharmaceutical, food & beverage, and agriculture sectors, Malaysia’s cold chain logistics is expected to see accelerated investments. By 2029, cold storage capacity is projected to expand by over 40%, supported by government incentives and private sector participation in temperature-controlled logistics infrastructure.

• Adoption of Smart Warehousing: The shift towards automation, robotics, and AI-driven inventory management will redefine warehousing operations. By 2029, it is expected that over 60% of large warehouses in Malaysia will deploy smart systems to improve storage utilization, order accuracy, and reduce turnaround times.

• Rising Demand for Last-Mile Delivery Optimization: As urbanization intensifies and customer expectations for same-day delivery grow, logistics companies will increasingly invest in micro-fulfillment centers and predictive routing algorithms. This will be especially crucial in high-density urban areas like Klang Valley, where traffic congestion impacts delivery efficiency.

• Green Logistics and Sustainability Push: Environmental concerns are pushing logistics providers to adopt sustainable practices. By 2029, electric vehicle adoption for intra-city deliveries is expected to rise by 25–30%, while green warehousing initiatives (solar-powered facilities, LEED-certified buildings) will gain prominence among large-scale operators.

Malaysia Logistics and Warehousing Market Segmentation

• By Market Structure:
  o Organized Logistics Providers
  o Unorganized/Independent Operators
  o Third-Party Logistics (3PL)
  o Fourth-Party Logistics (4PL)
  o In-house/Company-owned Logistics
• By Services:
  o Transportation (Road, Air, Sea, Rail)
  o Warehousing (General, Cold Storage, Bonded)
  o Value-Added Services (Packaging, Labelling, Reverse Logistics)
  o Inventory Management
  o Last-Mile Delivery
• By Mode of Transportation:
  o Road
  o Air
  o Sea
  o Rail
• By End User Industry:
  o E-commerce
  o Retail and FMCG
  o Automotive
  o Pharmaceuticals and Healthcare
  o Electronics and High-Tech
  o Industrial Manufacturing
  o Agriculture and Cold Chain
• By Region:
  o Central (Klang Valley, Selangor, Kuala Lumpur)
  o Northern (Penang, Perlis, Kedah)
  o Southern (Johor, Melaka, Negeri Sembilan)
  o Eastern (Pahang, Terengganu, Kelantan)
  o East Malaysia (Sabah, Sarawak)

Players Mentioned in the Report:

• GD Express (GDEX)
• Pos Malaysia
• DHL Express Malaysia
• FM Global Logistics
• YCH Group
• TheLorry
• Ninja Van
• J&T Express

Key Target Audience:

• Logistics and Supply Chain Companies
• Warehousing and Fulfillment Operators
• E-commerce and Retail Companies
• Government Bodies (e.g., Ministry of Transport, MIDA)
• Freight Forwarders and Customs Agents
• Investment and Private Equity Firms
• Research and Consulting Firms

Time Period:

• Historical Period: 2018–2023
• Base Year: 2024
• Forecast Period: 2024–2029