At the end of April, MarketsandMarkets published a report titled “Automated Guided Vehicle Market by Type (Unity Load Carrier, Tow Vehicle, Pallet Truck, Assembly Line Vehicle), Industry Verticle (Automotive and others), Application (Transportation, Distribution and others), and Geography — Global Forecast to 2020,” which stated the automated guided vehicle (AGV) market is expected to reach $2.2 million by 2020, growing at a compound annual growth rate of 9.8 percent between 2014 and 2020.

With the increase in industrial automation, the requirement for automated material handling also is expected to grow proportionally, in order to support this growth, according to MarketsandMarkets in a press release.

“The automated guided vehicle market is expected to benefit from emerging market investments that are enhancing the industrial infrastructure and facilities, while the developed markets are expected to continue to invest in more efficient material handling systems and procedures, which offer better and more efficient ways of material handling,” the company says.

Experts agree with this estimated growth in the AGV market saying there’s more to come. “Demand has increased, but still in small usages versus the potential applications,” says Brad Moore, vice president for AGV Pick at Buchs, Switzerland-based Swisslog.

Greene, N.Y.-based The Raymond Corp.’s Product Manager of Automation, Rudi Koetter, also agrees saying, “There’s a clear upwards trend in AGV system sales in the last year.”

According to Bryan Knott, global product manager of AGVs for Dematic Corp., the Grand Rapids, Mich.-based company also has seen increased demand for automation related to AGV systems, again supporting the report’s claim.

“We see a steady increase in demand for AGVs to replace existing manual fork truck labor as labor costs continue to rise and the skilled work pool continues to decrease,” Knott says. “It used to be that AGVs made return on investment (ROI) only on three-shift operations, and we are seeing sub-36 month ROIs in only two-shift operations today.”

Dematic offers a broad line of AGVs, according to Knott, which include forked-style trucks that can lift to 35 feet, and unit load “pallet” carriers that move pallets from one end of a facility to another.

Getting technical

As with any other part of the beverage industry, innovation has continued to flourish for AGVs. “The technology itself, and the system it’s a part of, have evolved today to where the AGV can do everything a forklift can do,” says Mark Stevenson, director of business development and sales for the beverage industry at Chicago-based John Bean Technologies (JBT) Corp. “We have yet to come across any specific tasks that an AGV hasn’t been able to do.”

According to Stevenson, AGVs have two main applications in the beverage industry. The first, he says, is using them to move full pallets of finished goods in end-of-line (EOL) applications in the manufacturing plant. The second is in the distribution center, where he says that AGVs maneuver full pallets for storage.

“When you look at these two areas, you definitely see an increase in those EOL applications,” he says. “About five years ago, we had an increase where we saw a lot of those EOL applications from the early adopters of technology, and now you’re seeing more companies embracing that type of application.”

Stevenson adds that it is this next wave of adopters to automation that encouraged JBT to develop its JayBot AGV system, which will launch to the packing industry in September at Pack Expo International. Stevenson says that the JayBot is a less expensive and simpler system for simple material handling tasks.

“We have high expectations with our launch of the JayBot,” Stevenson adds. “[W]e haven’t had as good of a solution for small systems or customers who want to just try out one vehicle to see if it’s right for them. We really see that helping create a second wave of AGV instillations in the beverage industry.”

However, according to Raymond Corp.’s Koetter, that’s not the only thing making a second wave in AGVs. He says that natural feature recognition is a trend that also might bring about a second wave. According to Koetter, it’s only because of natural feature recognition that Raymond recently re-entered the AGV market.

“Raymond was producing AGVs in the 1970s,” Koetter explains. “At the time, these products were really complex and difficult to use for our customers. They also were expensive and we had a lot of limitations in technology at the time. AGVs became a niche product, mainly used in manufacturing, not so much in warehousing and that was the reason Raymond divorced the business [in the 80s].”

Koetter notes that advancements in laser technology have brought Raymond back into the AGV business. Recently, Raymond launched two natural feature recognition AGV trucks: the Courier 3010, a center-control rider, and the Courier 3020-Tow, a tow tractor.

“These are the first two we have launched,” Koetter says. “Both trucks have manual brothers that we used to create these automated versions. They still have an operator compartment and everything you would need to operate it in manual mode.”

Money talks

Experts and analyses show that the AGV market is going to grow, which is great for AGV system suppliers; however, with more companies looking to purchase these solutions, AGV suppliers have had to find new ways to assist their customers in acquiring these, often expensive, systems.

“We definitely see a trend in the interest in leasing AGV systems. In the past, they were a capital investment. Most of these customers in the beverage industry are used to leasing their fork trucks, so it’s a very common thing for them to want to do,” JBT’s Stevenson explains. “It was really an issue in the past for it to be bought as a capital purchase. JayBot’s focus is to lease. …Leasing has some real financial advantages.

“The main difference is if they do a capital purchase, they have to pay for it all up front or once it’s installed,” Stevenson continues. “In a lease, they’re really just paying as they use it, and they don’t have to pay anything at all at instillation. …We did some calculations and presented a case of if you purchased the system versus if you leased it. It would be a 12 percent savings if you leased the system, and we weren’t even taking into account the tax advantages.”

In addition to the reduction of initial costs that AGV system suppliers can offer, Stevenson says an AGV system also can save beverage manufacturers money when it comes to damaged product due to material handling and damage at/of the facility.

AGV systems also offer several other benefits to warehouses and bottling plants, experts say.

In the beverage industry, tracking and traceability through operations is essential. “It’s important that manufacturers are able to track and trace every case on the pallet and every bottle in the case,” Stevenson says. “AGVs are highly reliable for tracking and traceability. …Once a load is captured in the system, it’s never lost.”

Additionally, Raymond’s Koetter says that in general AGVs are suitable for long runs, repetitive transport, and moving finished product among the other AGV strong hold applications. “Anything that’s palletized can be moved with AGVs,” he says.

 “If you talk about operators, you want to do away with the tasks that are repetitive, boring, and difficult or that aren’t operator friendly. That’s where automation really makes a lot of sense,” Koetter says. “You can use automation to streamline your overall workflow.”  

How to choose an AGV system

Automation has become inevitable if an operations facility desires to grow its efficiency. AGVs are one automation solution that many beverage manufacturers are looking to for both its return on investment (ROI) and efficiency.

Global Product Manager of AGVs for Dematic Corp., Grand Rapids, Mich., Byran Knott, offers Beverage Industry readers a list of the key factors to consider when choosing an AGV system for a warehouse or distribution center.

1. Automation benefits from two critical factors: Consistency and repeatability. Knott says to keep in mind that repeatability is dependent on consistency.
2. In the beverage industry, AGVs are most efficient for transporting two pallets at a time.
3. The consistency of pallets, their flatness (not necessarily the level) off the floor.
4. Return on investment (ROI) also is key to consider. “Companies should look at the overall distances of travel for each route, the typical number of shifts and FTEs as well as in peak times and, very importantly, the annual costs from pallet/product/racking/facility damage,” Knott says.
5. Finally, Knott suggest that a company should approach their challenges with a solution-based system, as opposed to looking at AGV systems as a commodity product. He also suggests a beverage company should put heavy weight on service and support post-sale to ensure the investment performs as anticipated.