Five transportation and logistics sectors to watch in Calgary

May 19, 2021
Aerospace & Logistics Transportation & Logistics New Economy
Logistics Article

Calgary Economic Development’s Transportation and Logistics Value Proposition Development report explores the city’s position as a leader in the global movement of goods and people, and opportunities for growth.

The transportation and logistics industry is considered an established cluster in Calgary’s economic strategy, Calgary in the New Economy, and contributed over $6 billion to the city’s GDP in 2020. The city has historical advantages along with current productivity and business activity levels, which provide it with a right-to-win in the regional and global market.

In recent research for Calgary Economic Development, several sectors within the industry showed strong opportunity for growth and business attraction to the city. Listed are the top five transportation and logistics “movers and shakers” to watch in Calgary.

Food manufacturing and logistics: This sector includes all logistics activities in the manufacturing, packaging and final movement of food and beverages, which may include either food components or prepared foods. Food and beverage processing is Alberta’s second largest subsector generating $14 billion in sales and was the largest manufacturing employer in the province accounting for more than 22,400 jobs. While other types of manufacturing experienced declines, food manufacturing sales in Alberta increased 5.9 per cent in 2020.

Regional distribution and logistics: This category includes warehouses and distribution centres (and their supporting activities) to service Western Canada, including distribution centres that specialize in value-added services like product mixing, order fulfillment, cross docking and packaging, in addition to general product storage. This sector has seen both growth and adaptation because of increased ecommerce and direct to consumer purchasing. Local innovation in materials movement automation, a competitive tax environment and abundant industrial lands directly adjacent to key transportation nodes are a few reasons why Calgary is set to scale in this sector.

Integrated logistics (3PL):  3PLs provide outsourced distribution, warehouse, and fulfillment services, which may include procurement, customization, packaging, and assembly. On a global scale, this sector has accelerated with global trade and the increase in ecommerce, and is driven by increased trade into and out of Asia.  Excellent multimodal connections to North American and global markets, and a strong transportation and logistics sector labour market, provide a strong case for the expansion of additional global 3PL providers into Calgary, providing an additional (or consolidated) Western Canadian nexus.

Truck services: Truck services includes fleet management and support services for trucking companies already operating in the Calgary market. Due to the current level of logistics activity in the region, there is a need for washing, vehicle servicing, and other services to ensure the continued streamlined operation of regional fleets. Other activities include fleet maintenance, chassis storage and fleet management services.

Air cargo: Air Cargo refers to any cargo carried or being prepared for shipment in an aircraft, which includes air freight, air mail, air express and special cargoes. Air cargo volumes are expected to grow globally by over four per cent per year, and approximately half will be carried by freighters. Calgary could see opportunities for enhanced and increased air cargo processing and servicing, including ground support services. The Calgary International Airport (YYC) already handles 75 percent of Alberta’s air cargo shipments and is Canada’s second busiest airport for air cargo flights with connections to 100 destinations.

Alberta is home to 25 per cent of Canada’s unmanned aerial vehicle (UAV), geospatial and navigation companies, most of which are based in the Calgary region. Calgary is also one of the first major cities in North America to allow mass testing of commercial drones and other autonomous systems.

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