The electric forklift rental business model benefits greatly from switching the equipment to lithium batteries from widespread lead-acid batteries. Lithium batteries have long lifespans, are economical and durable and require low maintenance, resulting in improved profitability for forklift dealers and helping customers achieve their sustainability objectives. As forklifts become increasingly electrified and rental fleets expand, lithium batteries are a wise investment for both dealers and renters.
Long-term rental of forklifts
When renting out forklifts for extended periods, the switch to li-ion batteries provides similar advantages as leasing or buying own equipment. These benefits can be summarized as follows:
- Reduction in labor costs for maintenance (no need for daily watering and synchronization charges);
- Lower electricity use, leading to lower carbon emissions during operations, due to higher efficiency of energy conversion of lithium batteries;
- Improved overall efficiency in operations with less downtime and better forklift performance;
- A cleaner and safer workplace when compared to using flooded lead-acid battery packs.
Companies may choose to buy new or select used electric forklifts in online classifieds and get all these benefits of lithium technology. But what about those operations that opt for short-term rental of their forklifts?
Short-term rental of forklifts
When it comes to renting out forklifts for shorter periods of time, dealers face unique challenges. Renters have no incentive to invest in the proper maintenance of the batteries, often neglecting to water them regularly or synchronize their charge, returning them "dry" at the end of the lease term. The renter is required to run the tests and discuss the potential reimbursement for the damage and service labor, which no one likes to do.
A dealer would typically sell used equipment after five years, and the value of a lead-acid battery by this time is zero. However, with an advanced forklift battery,a buyer gets a full picture of the cycles left in a battery and can calculate how many years it can be expected to power the truck he buys.
Rental contracts can be irregular, and if left idle for even a few weeks, a lead-acid battery can lose its charge and suffer permanent loss of capacity if not cared for properly. The worst thing that can happen to a lithium battery is if an operator forgets to charge the battery pack.
Compared to lead-acid batteries, lithium-ion batteries are much more energy-dense and do not lose voltage with discharge. This means that a lithium battery with a lower Ah capacity can still cover most needs of a diverse pool of forklift renters, significantly reducing the cost of purchasing batteries for dealers. Additionally, lithium battery chargers are much smaller and lighter, which makes them easy to install or wall-mount around the facility.
Growing popularity of equipment rentals
Forklift buyers see very long lead times for new equipment, and dealers are facing challenges in meeting demand due to economic factors such as high inflation rates and supply chain disruptions.
Due to the rising costs and low availability of the new equipment, more and more end users are opting to rent instead. This helps them have fixed costs, and avoid potentially depreciation costs related to the unstable economic situation.
According to the American Rental Association (ARA), equipment rental revenue in the United States is expected to continue growing. In their 2023 update, the ARA projected a 7.6 percent increase, which would amount to $60.4 billion in revenue for construction and general tool rentals.
Lithium forklift batteries offer unique benefits for the burgeoning market segment of forklift fleet rentals by completely eliminating the pain of irregular service and maintenance. Lower required capacity, long cycle life, and significant savings on the total cost of ownership help accelerate the electrification of equipment and improve dealers' bottom line while helping their customers achieve their sustainability and safety goals.