Automated Guided Vehicle (AGV) Market is projected to grow from USD 2.3 billion in 2020 to USD 3.6 billion by 2025; it is expected to grow at a CAGR of 9.3% from 2020 to 2025. The key factors fueling the growth of the market include growing demand for automation in material handling across industries, improved safety standards at workplaces, and a shift in demand from mass production to mass customization. Additionally, the integration of industry 4.0 with robotics is also augmenting the growth of the AGV market.
Europe is projected to be the largest market for an AGV from 2020 to 2025; Europe is projected to hold the largest size of the AGV market during the forecast period. The presence of a large number of key players in this region, along with the large customer base, is among the major factors driving the AGV market in Europe. The region has an exceptionally high labor cost; therefore, manufacturers in European countries have been adopting automated solutions to reduce overall operational costs. Due to COVID-19, various industries in Europe are suffering from unprecedented strain on its economy. The government orders for suspension of production and temporary shutdown are further affecting the industrial output in the region. Thus, the economic slowdown resulting from the COVID-19 is impacting the demand for AGVs in Europe.
The laser guidance segment to hold the largest size of the AGV market by 2025; the growth of the laser-guided AGVs market can be attributed to their flexibility, scalability, and accuracy of the laser guidance technology. It also improves safety, increases throughput, and minimizes downtime. Laser guidance is the most flexible system for vehicle movement and offers accurate navigation. It allows the vehicles to operate in a warehouse without the need for invasive barriers. Due to the imposition of lockdowns across different countries as a result of the COVID-19 outbreak, companies are facing severe cash flow issues. Halting or slowing down of production across industries has resulted in a decline in demand for AGVs.
The two vehicles to account for the largest size of the AGV market in 2020; the implementation of two vehicles in warehouses and stores helps operators achieve maximum efficiency, which is expected to contribute to the highest growth of the market for e-commerce during the forecast period. Moreover, the prominent players in the industry have been affected owing to the outbreak of COVID-19. The foreseeable decline in the growth of end-user industries may have a considerable direct impact on the AGV market in FY20.