Rod Dayrit (Delta-Q)Rod Dayrit is the Director of Business Development for USA at Delta-Q Technologies, a ZAPI GROUP company. Dayrit joined Delta-Q in 2018 and has more than 20 years of experience with design and development in the electrical field. Throughout his time with Delta-Q, he has informed global growth strategies and spearheaded the creation and launch of the company's compatibility program, "Charged by Delta-Q." Prior to joining Delta-Q, he held senior sales and business development roles at Samsung SDI, Foxlink and Motorola.
As the world becomes more conscious of its carbon footprint, industries are looking for ways to reduce their environmental impact.
The forklift industry is no exception. With increasing demand for sustainable operations, forklift manufacturers are embracing electrification as a key strategy to reduce emissions and improve efficiency.
Five trends emerge as the drivers of electrification in the forklift industry: advances in lithium battery technology, the growing popularity of equipment rentals, advances in charging technology, standardization and growth in charging infrastructure and continuous regulatory pressure. Below we will break down these five key drivers and highlight how these events impact forklift manufacturers and end users.
Advances in lithium battery technology
Lithium batteries are driving the electrification of the forklift industry. Recent advances in lithium-ion battery technology include improved separator technology, battery management systems and safer chemistries without rare metals like cobalt and nickel. These advances have made them safer, more reliable and environmentally friendly.
Lithium batteries offer many benefits over traditional lead-acid batteries, such as longer life, faster charging and higher power density. The greatest advantage of this battery technology is opportunity charging, where lift trucks can charge whenever an opportunity arises, which would significantly shorten the life of lead-acid batteries. Because lithium batteries are lightweight and small, they allow enough space within forklifts to install robust on-board charging solutions. Several original equipment manufacturers (OEMs) are leading the way in this transition, such as Jungheinrich, which offers purchasing or rental options to switch from internal combustion engine (ICE) and lead-acid battery-powered forklift trucks to lithium battery technology.
Growing popularity of equipment rentals
End-users in material handling are changing their mindset about capital expenditure. Due to economic factors such as soaring inflation and supply chain disruptions, dealers are struggling to meet demand. As a result, the cost of owning equipment escalates, leading to a surge in demand for rental equipment among end users. By turning to rental equipment, stakeholders can conserve capital and avoid higher rates associated with ownership. Rental equipment also offers end users an affordable way to access the latest technology, such as electric forklifts, which would otherwise be costly to own. The increase in rentals is increasing accessibility to advanced electric solutions, which further drives the growing demand for electrification among end users.
The American Rental Association (ARA) projects continued growth in equipment rental revenue in the U.S. In its 2023 update, the association anticipated a 7.6% growth, resulting in $60.4 billion of construction and general tool rental revenue.
New developments in charging technology
On-board charging has become a key consideration for forklift manufacturers as real estate costs continue to rise. On-board solutions provide a better alternative to the operational demands and challenges experienced by large warehouses, material handlers and rental fleets because they take up less physical space and are less costly than the infrastructure required by offboard charging solutions. Specifically, OEMs are moving away from large 480 VAC infrastructure, which is costly and takes up a lot of space, and are turning to on-board charging as a replacement for single phase 240 VAC.
Forklift operators can charge their machines quickly and easily with on-board chargers, eliminating the hassle of setting up the charger and attaching the battery. This feature provides operators with greater flexibility to charge whenever an AC source is available, such as during breaks or in-between shifts. In addition to freeing up space and reducing costs, on-board chargers simplify the process of integrating the battery and charger with telematics and CAN bus systems. Fleet managers can access valuable fleet management data through telematics, enabling them to monitor battery and charger health and performance. Identifying poor battery charge management and introducing preventative maintenance capabilities helps managers prevent costly repairs or service calls and helps OEMs enforce warranty claims.
Standardisation and growth in charging infrastructure
The automotive industry is leading the way in standardizing charging infrastructure, which significantly impacts the electrification of industrial vehicles, including forklifts. The common standard Open Charge Point Interface (OCPI) protocol was introduced in 2020 to allow for simplification, standardization and harmonization of charging points worldwide. This protocol is used to connect EV charging station operators with service providers.
Furthermore, the automotive industry has shown that increasing the deployment of public charging infrastructure, in anticipation of growth in EV sales, is critical for widespread EV adoption. At the end of 2022, there were 2.7 million public charging points worldwide, more than 900,000 of which were installed in 2022, about a 55% increase in the number present in 2021.
Increased access points for charging, driven by the demand for electrification in the automotive industry, will allow forklift operators to charge on the go — either by fast charging or opportunity charging, leading to increased productivity and cost savings for end-users.
Increased Regulatory Pressure
Companies are increasingly considering carbon emissions reduction as a key priority, driven by both incentives and mandates from federal and localized initiatives. The investment in electric energy is signaling the critical role of electrification in future sustainability plans, with California leading the way through its California Air Resources Board (CARB). By 2035, the state has set a goal of selling only zero-emission new cars, SUVs, and pickup trucks. A significant portion of the U.S.'s Inflation Reduction Act (IRA) includes plans to fund electrification technology and similar projects. This climate reform legislation has allocated $5.8 billion for all major electrification projects in the U.S. Additionally, the Environmental Protection Agency (EPA) has recently proposed more ambitious standards to decrease harmful air pollutant emissions. These local and federal regulatory pressures to reduce carbon emissions will continue to guide the electrification of industrial sectors, which includes the forklift industry.
In addition to increased regulatory pressure, several other factors further enable electrification across the forklift sector. These include the advancements in battery and battery charger technology and the ongoing global focus on sustainability and carbon reduction. Forklift manufacturers are embracing electrification as a key strategy to reduce emissions and improve efficiency while also providing greater flexibility and cost savings for their customers.