A forked road ahead

Steady growth for the forklift, unsung hero of the logistics boom

Suppliers are experiencing growing demand for MHE machines.
Suppliers are experiencing growing demand for MHE machines.

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Where would the logistics industry be without its forklifts? Ahead of this month’s Materials + Logistics event in Dubai, PMV looks at an essential piece of equipment at the heart of efficient material handling: the forklift.

As the boom for the logistics sector came to an abrupt halt during the recession, the demand for forklifts receded greatly. Now, however, with the region’s logistics companies witnessing a steady revival, material handling equipment (MHE), suppliers look set to receive a much-awaited lift.

“Without a doubt, the global economic downturn did affect all segments across the MHE market in 2009 and the logistics forklift sector was no exception,” agrees Frederic Gomer, supply chain consultant at B2G. “However, in the post-recession period, the market has already shown signs of improvement.”

Based on industry analysis, experts like Gomer predict that global demand for logistics forklift equipment is expected to improve in 2011, with steady growth in the Middle East.

“In the region, the logistics forklift sector is presaged to witness a rise in demand driven by mining, manufacturing, logistics and power industries,” Gomer predicts.

It is this very same manufacturing boom that has been exciting logistics companies. The greater the demand for goods, the greater the need for logistics services to transport them. This, in turn, can only be good news for the forklift industry.

Forklifts provide one of the most critical components in a logistics industry that depends on material handling equipment to achieve efficient storage and handling.
“Since the logistics industry is so heavily reliant, we can only expect that the demand for forklifts will organically follow the sector’s growth,” Gomer said.

The region’s leading suppliers of forklifts have been watching for signs of market growth very carefully. “Following the period of economic uncertainty, we noticed the first signs of recovery in 2010,” says Vladimir Knezevic, general manager of Al Futtaim Motors’ commercial division. “The first quarter of 2011 demonstrated steady growth and we are confident that this recovery trend will continue throughout the year.”

The UAE-based company has stepped up a gear in developing its MHE business through its range of BT and Toyota warehousing equipment. As well as its extensive showroom and service facility in Dubai, Al Futtaim Motors has now built a twin facility in neighbouring Abu Dhabi. The company provides an after-sales service made up specialised technicians and a fleet of mobile workshop vehicles.

Like most forklift suppliers, the logistics industry represents the most important customer segment for the company. “In particular, small local and large international logistics companies drive the forklift business by replacing and/or adding more units to the existing fleet on a yearly basis,” Knezevic says. “These companies often require innovative solutions and thereby create a very dynamic market.”

Just this year, Toyota MHE itself launched a number of new BT warehouse trucks. The BT Optio Order Pickers and BT Vector VNA trucks, as well as the fourth-generation BT Radioshuttle, are all designed to help customers drive down costs while contributing to safe and efficient operations. Developments in forklift technology have led to a shift in demand for the type of equipment now required by the region’s logistics players.

“The real challenge for today’s forklift supplier is to increase productivity, accuracy and safety while decreasing costs,” says Knezevic.

Furthermore, experts like Gomer expect forklift customers to tend towards the more advanced equipment available in the Middle East in the future.

“With the automation of logistics platforms and warehouses, the use of advanced and automated equipment such as automated guided vehicles and robots is expected to grow,” he predicts. For now, however, the real shift in terms of forklift popularity has been towards both marrow aisle (NA) and very narrow aisle (VNA) material handling equipment, with suppliers reporting an increase in sales.

Al Futtaim Motors supplies two VNA products in the BT Vector range – the C-series and the R-series.

“The former services the most demanding of warehousing operations, where high productivity is a constant requirement, whereas the latter is the latest man-down solution, designed for handling full pallets in very narrow aisles,” Knezevic explains.

“We noticed that international logistics companies are increasingly interested in VNA products that help them to get the most value from their high-density storage applications and drive down the costs.”

But what is driving this push for more VNA forklift products? The demand, it appears, is driven by a shift in how warehouses are managed. “Today’s logistics industry requires high productivity machinery with less downtime to keep up their delivery commitments,” says G. Venkat, divisional manager for equipment & material handling at United Motors and Heavy Equipment, supplier of the popular Yale forklift.

Bassem Al-Bermawy, regional product manager for Linde MHE at FAMCO, recognises the trend towards building ever higher storage systems to cater for regional market growth.

According to Al-Bermawy, logistics operations have become more focused on moving goods quickly through the supply chain, with the goods spending the minimum time in each stage of the chain.

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