In the last three decades, operations leaders and facility managers worldwide have made significant progress in making the switch from traditionally-powered forklifts to electric. This period of change has provided incredibly useful lessons we can apply to understanding the evolution of the electric vehicle (EV) space.
Forklifts have been at 35 to 40 percent electric for decades, and in the last twenty years have grown to 65 to 70 percent of new sales. In 2023, despite a surge by nearly 52 percent, Kelley Blue Book reported that electric vehicles still account for only 7.6 percent of the total US vehicle market.
What’s contributed to that growth? What’s stalled it? And what can we take away for the future of EV adoption in the consumer sector? Here are five trends I see on the horizon for the EV sector, and what we need to do to mitigate them:
1. Public and private investment will continue to play a key role.
EVs today are seeing a more concerted level of investment – both by public sources (government) and by private interests. We expect that these external investments will continue to play a pivotal role in reaching EV adoption targets in coming years. Over the last 30 years, we’ve seen from the electrified forklift industry what a slow or lacking rate of investment yields. It’s taken three decades to garner about a 20 to 25 percent gain of market share of electric versus internal combustion engines (ICE.) If the EV industry is going to exceed that pace of growth, continued heavy emphasis on external funding will be a non-negotiable. With public incentives now in place, consumers will also have an even more palatable ROI with EVs.
…The significant wait for meaningful return on investment will continue to be a deterrent to purchase.
2. Timing on ROI will continue to slow EV adoption.
Whether the customer is a facility manager considering the pros and cons of electrified forklifts versus ICE trucks, or a private citizen looking at EVs versus gas-powered automobiles, the significant wait for meaningful return on investment will continue to be a deterrent to purchase. The fact is, upfront costs of electrified forklifts / EVs are still a greater outlay than traditionally-powered vehicles. And lower maintenance and fuel costs can’t always bridge the gap in the mind of the consumer. The time to recoup initial costs will continue to present a hurdle for widespread adoption of electrified power.
3. Consumer education about EVs must become more of a focus.
It’s been an unfortunate reality for decades in the forklift power space: the nuances of electric power versus traditional power can be a major stumbling block for would-be adopters. With electric forklifts, the questions and confusion may be related to transition to lithium, what electrification means for the facility infrastructure, what types of systems and safety need to be in place, etc. Customers considering EVs have their own far-ranging set of questions and concerns. Improved access to consumer education is necessary to properly and broadly address them. Training operators — or consumers — during transitions like this is a critical part of the adoption curve.
4. Charging infrastructure demands attention.
For years now, operations leaders and facility managers have considered the charging infrastructure required in their warehouses and facilities – it’s a necessary step in ensuring a smooth transition to a fully electrified forklift fleet. Consumers considering the switch to EVs must face similar considerations in their homes, apartment buildings, and at work. In many cases, electric panel upgrades and other infrastructure changes are required to make charging possible. This can be a real limitation – both intellectually and logistically – to making the switch. The EV industry will have to continue to support, equip and empower consumers to establish proper infrastructure if we want to see record numbers of adoption.
5. Environment factors will continue to limit EV usage.
Even after 30 years of technological progress, some electrified forklifts simply cannot deliver the necessary duty cycle based on the application. This can be related to temperature extremes (both hot and cold), throughput demands, or other environmental conditions. Unfortunately, we’re seeing the same challenges and limitations with EVs. As an example, we’ve seen many US and Canada-based companies hesitate to make the switch to electric delivery vehicles due to the distances required for travel in rural areas, as well as the temperature impacts in those markets. The EV industry will have to continue to innovate and solve for these issues. If they want to drive mass adoption they will also need to be intentional about the design for the markets they are addressing.
Despite these factors, I do expect to see EV adoption continue along a natural progression in the years and decades ahead. But the speed is questionable. At the end of the day, the rate at which these changes occur is dependent on the solutions provided for the above-mentioned considerations, among others.
The forklift power industry has seen a significant electric power adoption over the last 30 years. This progress has been made without the same level of public and private investment and heavy focus on technological innovation and widespread consumer education – all of which the EV industry can and should benefit from. With lessons learned and applied from the electric forklift industry, it’s possible to more efficiently navigate the electrification landscape.
Michael Galyen is an expert in forklift power and Vice President Technology & Product Management at Concentric, a national distributed power services organization delivering resilient and sustainable facility power systems for critical power and forklift mobility.
